Sugar Market Faces Demand Dip Amid Steady European Prices: 2025 Outlook

The global sugar market is at a delicate crossroads as 2025 approaches. Prospects of ample supply, tempered consumption in key consumer markets, and evolving weather patterns are keeping market sentiment low and casting a shadow over price action. In India—the world’s second-largest sugar producer—a recent government allocation for June sits at 2.3 million tonnes, down 0.25 million tonnes from last year. This signals a potential season-long consumption drop below 28 million tonnes, compared to last year’s record 29.05 mt. Industry insiders cite weak domestic demand, tepid exports due to sluggish international prices, and the impact of early monsoons and frequent rains during the normally robust summer consumption period. Compounding the situation is the projection of a bumper crop for 2025-26 and a likely closing stock at the end of this season possibly below 5 mt, which nearly matches India’s festival demand for the early next season.

Meanwhile, EU sugar prices remain firm but stable across primary regions, with little price movement for granulated sugar varieties. Market players are watching weather developments in the subcontinent and Brazil, as early monsoons in India and fields’ condition in Brazil will play a decisive role for the latter half of the year. Internationally, persistent weak market sentiment is reinforced by subdued demand and anticipations of increased supply, with speculative positions shifting cautiously bearish. The interplay between anticipated Indian bumper harvest, regulatory sales quotas, and global supply dynamics will shape the trading landscape in the coming months.

📈 Prices

Origin/Type	Location	ICUMSA	Price (EUR/kg)	Change (W-o-W)	Update Date	Sentiment
Sugar granulated	Norfolk, GB	ICUMSA 32	0.56	0.00	2025-05-27	Stable
Sugar granulated	Norfolk, GB	ICUMSA 32	0.56	0.00	2025-05-27	Stable
Sugar granulated	Norfolk, GB	ICUMSA 45	0.56	0.00	2025-05-27	Stable
Sugar granulated	Berlin, DE	ICUMSA 45	0.66	0.00	2025-05-27	Firm
Sugar granulated	Vyškov, CZ (UA origin)	ICUMSA 45	0.54	0.00	2025-05-27	Stable
Sugar granulated	Mirijampole, LT	ICUMSA 45	0.53	0.00	2025-05-26	Weak

🌍 Supply & Demand

• India: 2024-25 consumption projected to drop under 28 mt (vs. 29.05 mt in 2023-24).
• Government restricts June quota to 2.3 mt (down 250,000 t year-on-year).
• Industry expects end-season stock below 5 mt—equivalent to festival demand.
• Factors: early monsoon, summer demand hampered by rains, weak exports.
• Global: Projected bumper Indian crop in 2025-26, Brazil’s steady output, and EU stability.

📊 Fundamentals

• India’s notional stock as of May 31: 13.43 mt (may rise to 13.93 mt by September).
• June-September expected consumption: 9.1 mt (including 2.3 mt June quota).
• USDA, AISTA, and industry projections all highlight lower demand and large stock carryovers.
• International price sentiment is weak, hindered by ongoing poor export opportunities and bearish speculative positioning.

🌦️ Weather & Crop Outlook

• India: Early and frequent monsoon rains have curbed usual summer demand but benefit field restoration for 2025-26 planting, making a bumper crop more likely.
• Brazil: Southern Brazil’s harvest is progressing smoothly under favourable weather.
• EU: Central and Eastern European beet fields are in good shape, supporting stable regional production.

🌐 World Supply & Inventories

Country	Production 2023-24 (mt)	Projected 2024-25 (mt)	Ending Stocks (mt)	Trade Position
India	31.7	32.5*	<5 (projected)	Major Exporter (restricted)
Brazil	45.7	45.5*	Stable	Top Exporter
EU	16.3	16.4*	Stable	Self-sufficient
Thailand	9.4	9.2*	Lower	Major Exporter

*Provisional/industry estimates

💡 Trading Outlook & Recommendations

• Sellers: Consider locking in forward prices if exposed to further global supply increases, especially from India and Brazil.
• Buyers: Opportunities exist to build strategic reserves as prices remain flat and risk a further dip should Indian output surge in Q4 and Q1 2026.
• Traders: Speculative short positioning could remain favourable given ongoing weak demand and prospects for rising supply next season.
• Monitor: Indian monsoon development, government quota releases, and Brazil’s harvest pace for volatility signals.

📆 3-Day Regional Price Forecast

Region/Market	Current Price (EUR/kg)	3-Day Forecast (EUR/kg)	Sentiment
GB (Norfolk, ICUMSA 32/45)	0.56	0.55 – 0.56	Stable/Weak
DE (Berlin, ICUMSA 45)	0.66	0.65 – 0.66	Stable
CZ (Vyškov, ICUMSA 45)	0.54 – 0.56	0.54 – 0.55	Stable