Sugar Market Outlook: Price Weakness as Harvest Pressure, Global Inventories, and Weather Weigh

The global sugar market enters a period of renewed softness, marked by recent declines at major futures exchanges and modest pressure on physical prices across Europe. This comes amid robust harvest activity in key producing regions (notably Brazil and India), evolving weather patterns, and shifting demand from major importers. Market participants have seen ICE raw sugar (No. 11) futures and white sugar (No. 5) contracts lose ground through mid-September 2025, reflecting both the impact of a solid Northern Hemisphere crop and a normalization of global sugar flows after volatility in prior quarters.

While production from the leading exporter, Brazil, continues apace—buoyed by favorable weather—a complex landscape is unfolding elsewhere: Indian exports remain constrained by government policy, while EU outputs have improved but not returned to pre-drought levels. Speculative positioning is somewhat lighter, signaling a reduction in bullish conviction. Meanwhile, end-user demand in Asia and Africa is steady, but not accelerating, and importers are watching inventory levels closely as the harvest window progresses. Weather remains a persistent wildcard, with El Niño/La Niña shifts influencing expectations, especially for India’s next planting season and EU beet development. As sugar prices ease, some producers are locking in contracts and buyers are opportunistically sourcing at spot levels. Momentum for a rebound hinges on weather risks and policy shifts, but near-term sentiment is neutral to slightly bearish as supply weighs.

📈 Prices & Market Performance

Contract	Closing Price	Weekly Change	Sentiment
ICE No.5 White Sugar Dec 25	465.80 USD/t	-0.02%	Neutral/Bearish
ICE No.11 Raw Sugar Oct 25	15.90 USc/lb	-0.63%	Bearish
ICE No.5 White Sugar Mar 26	457.90 USD/t	-0.26%	Bearish
ICE No.11 Raw Sugar Mar 26	16.56 USc/lb	-1.03%	Bearish

🇪🇺 Spot & Physical Prices (EUR/kg, FCA)

Product/Origin	Location	Price	Change
Sugar granulated ICUMSA 32, GB	Norfolk (GB)	0.57	0.00
Sugar granulated ICUMSA 32, GB	Norfolk (GB)	0.56	-0.01
Sugar granulated ICUMSA 45, GB	Norfolk (GB)	0.56	-0.01

🌍 Supply & Demand Drivers

• Harvest Progress: Brazil’s main Center-South crop is advancing rapidly, keeping supply robust. India, second largest producer, remains cautious on export quotas; its total 2024/25 output is below highs but steady. EU production is up year-on-year due to better beet yields after 2024 drought recovery.
• Inventories: Global stocks-to-use ratios have climbed as surpluses emerge from Brazil and marginal recovery in Thailand and the EU. India’s government continues to curb exports to shore up local supplies.
• Speculation & Funds: Managed money net long positions have declined over recent weeks, reflecting reduced bullish conviction amid improved supply outlooks.
• Demand Trends: Asian buyers are steady but waiting for further price drops; Middle Eastern and African importers are active with tenders, but no aggressive buying.

📊 Fundamentals & Macro Influences

• USDA/ISO Reports: The most recent USDA and International Sugar Organization data confirm a moderate global surplus projected for 2025, after two volatile years.
• Crop Acreage: Areas planted in Brazil remain close to record highs; the EU sees more stable acreage but higher productivity, while India may reduce planting unless price support continues.
• Currency Factor: Weakness in BRL and INR props up local producer margins, incentivizing continued exports from Brazil, limited shipments from India.
• Energy Link: Lower oil prices ease the ethanol parity floor in Brazil, guiding more cane towards sugar production.

🌦 Weather Outlook

• Brazil: Dry weather supports harvest pace, with little near-term yield threat.
• India: Late monsoon impacts in Maharashtra and Uttar Pradesh raise mild concerns for 2025 cane; widespread deficits could tighten late-2025 supply but so far stable.
• EU: Favorable summer rains aid beet yields in France, Germany, and Poland; upside risk for output if autumn remains mild.
• Thailand: Weather normalization after previous droughts could lift 2025 output.

🌎 Global Production & Stocks Snapshot

Region	2024/25 Output (Mt)	Change Y/Y	Policy/Outlook
Brazil	39.2	+5%	Exporting at full pace
India	34.5	-3%	Export quota restricted
EU	17.4	+6%	Improved beet yields
Thailand	10.8	+7%	Recovery from drought

📌 Trading Outlook & Recommendations

• Expect continued softness in global and EU sugar prices with ample supply from Brazil and improving EU harvests; risk of short-covering rallies if adverse weather emerges in India or Brazil.
• Buyers may consider scaling in procurement at spot or short-term contracts to take advantage of pullback.
• Producers: Hedging recommended if current pricing covers costs; caution on holding unsold stocks.
• Monitor Indian policy for signs of export liberalization—a potential price bullish trigger if restrictions ease.
• Keep close watch on monsoon outlook in India (Oct/Nov) and EU beet weather (early autumn)—these are key weather swing factors into Q4.

📆 3-Day Regional Price Forecast

Exchange/Region	Current	3-Day Forecast	Direction
ICE No.11 Raw Sugar (Oct 25)	15.90 USc/lb	15.80–16.10 USc/lb	Stable/Soft
ICE No.5 White Sugar (Dec 25)	465.80 USD/t	463–468 USD/t	Stable/Soft
Central EU (spot, FCA)	0.54–0.58 EUR/kg	0.54–0.57 EUR/kg	Slightly Soft