Sugar Market Trends: Weak Bulk Demand Pressures Prices, Supplies Swell

This month, the sugar market has witnessed noticeable downward pressure as a result of subdued demand from bulk buyers and persistently high supply levels at mills. Despite the start of the festival season in several key regions, demand from large-scale consumers has remained muted, prompting mills to reduce spot and contract prices by as much as $0.60 per 100 kg. In major trading hubs like Delhi and Muzaffarnagar, M-grade sugar now trades comfortably below $53 per 100 kg, with even sharper discounts in futures contracts seen at the Mumbai Vashi market. However, premium refined sugars continue to reflect strong price resilience, particularly in Southern India, where consumer preference for quality is sustaining a notable premium. Interestingly, despite the slip in sugar, associated products such as gur (jaggery) and shakkar remain stable, buoyed by regular retail demand. As we move forward, traders should be attentive to stock levels, festival demand recovery, and global weather patterns which may yet rebalance the supply-demand equation.

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📈 Prices

Market/Exchange	Product/Grade	Latest Price	Weekly Change	Sentiment
Delhi (wholesale)	M-grade	$48.50–$50.00/100 kg	-1.0% approx	Bearish
Muzaffarnagar	Sugar	$51.80–$53.00/100 kg	-1.4% approx	Bearish
Mumbai Vashi (futures, near-month)	M-grade	$55.40/100 kg	-1.4% (from $56.20)	Bearish
Spot, Mumbai Vashi	M-grade	$53.75–$54.25/100 kg	-0.7% approx	Bearish
South India (select mkts)	Refined, premium	$62.50–$63.75/100 kg	+0.0%	Bullish (quality premium)

Country	Origin/Location	Product	Latest Price (EUR/kg)	Previous Price	Date
United Kingdom	Norfolk	ICUMSA 32, 0.3–0.6mm	€0.57	€0.55	2025-08-06
United Kingdom	Norfolk	ICUMSA 32, 0.45–0.6mm	€0.57	€0.55	2025-08-06
United Kingdom	Norfolk	ICUMSA 45, 0.212–0.425mm	€0.57	€0.55	2025-08-06

🌍 Supply & Demand

• Supply: Indian mills report well-above-average stocks, with minimal drawdowns expected before a meaningful pick-up in festival demand.
• Demand: Bulk and institutional purchasing is soft; retail sales remain resilient, especially in the jaggery and shakkar segments.
• Trade: Export activity from India remains low amid government restrictions and internal market focus; global buyers seek alternative sources from Brazil and Thailand.

📊 Fundamentals

• Market Drivers:
  • High inventories in key producing states offsetting slow demand.
  • Subdued festival/catering demand relative to prior years.
  • Premium for refined/quality grades persists in select markets despite broader price declines.
  • Speculative positioning has turned net short on major exchanges.
• International Context:
  • Brazilian exports hit new highs, offsetting lower flows from Asia.
  • EU market steady; imports from Eastern Europe and CIS region rising, as referenced by recent FCA price offers from GB (€0.57), LT (€0.58), DE (€0.69), CZ (€0.55–€0.59), DK (€0.58), and UA (€0.55–€0.58).
  • World raw sugar (ICE No. 11) futures at ~$22.20c/lb, down from last month’s $23.10c/lb, reflecting global supply excess.

☀️ Weather Outlook

• India: Monsoon rains have been patchy in Maharashtra and Uttar Pradesh, but overall crop outlook is stable. Any significant dry spell or flooding could still impact cane recovery rates.
• Brazil: Cane regions report good weather, supporting robust harvest and crush rates.
• Thailand: Rainfall near average, decelerating drought worries from earlier in the season.
• Global Effect: No immediate weather-driven supply shocks forecast for key exporters in next two weeks.

🌐 Production & Stocks Table

Country	2023/24 Output (mln t)	YoY Change	2023/24 Stocks (mln t)	Latest Trend
India	33.5	-3%	6.8	High stocks, low exports
Brazil	40.2	+5%	4.1	Strong exports
Thailand	8.1	+2%	1.9	Stabilized
EU	16.9	+1%	1.3	Balanced

📆 Trading Outlook & Recommendations

• Short-term bias remains bearish unless Indian festival demand accelerates or new export policies are announced.
• Expect a potential short-covering rally if weather disruptions or logistical issues arise in Brazil/Asia.
• Premium refined and specialty segments are insulated from broader declines; niche sellers may maintain higher pricing.
• Importers should monitor FCA offers from EU and Black Sea origins, currently competitive in EUR terms.
• Watch for updates on Indian government policy regarding minimum selling price or new export quotas.

🔮 3-Day Regional Price Forecast (Key Exchanges)

Market	Current Price	3-Day Outlook	Direction
Delhi M-grade	$49.25/100 kg	$48.70–$49.00/100 kg	⬇️ Slightly Lower
Mumbai Vashi (futures)	$55.40/100 kg	$55.10–$55.30/100 kg	⬇️ Slight Decline
EU FCA (Norfolk)	€0.57/kg	€0.56–€0.57/kg	➡️ Stable
South India (premium refined)	$63.00/100 kg	$62.80–$63.25/100 kg	➡️ Stable