Sugar Prices Face Sharp Decline as EU Market Struggles with Oversupply

📉 Sugar Prices Face Sharp Decline as EU Market Struggles with Oversupply

ICE Sugar No. 5 futures saw a significant pullback, with the May 2025 contract falling by 1.20% to USD 524.50/t (EUR 488.79/t). Despite strong attempts to push sugar prices higher in the EU market, the industry is failing to absorb its overproduction. In Poland, sugar is being offered significantly cheaper than in Germany, with prices as low as EUR 0.55/kg DAP for Polish production. With global demand lagging and oversupply weighing on the market, price increases remain unattainable.

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📊 Market Overview: ICE Sugar No. 5 Prices & Developments

Contract	Closing Price (USD/t)	Closing Price (EUR/t)	Change (USD)	Change (EUR)	Change (%)
May 25	524.50	€488.79	-6.30	-5.86	-1.20%
Aug 25	509.40	€474.31	-4.40	-4.09	-0.86%
Oct 25	503.90	€469.78	-3.30	-3.07	-0.65%
Dec 25	502.90	€468.80	-2.50	-2.33	-0.50%
Mar 26	505.20	€470.84	-1.80	-1.68	-0.36%
May 26	503.20	€469.38	-1.90	-1.77	-0.38%

📌 Exchange rate used: 1 USD = 0.93 EUR

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🌍 Key Market Drivers & Influences

🔹 Heavy Selling Pressure & Global Price Decline 📉

• Global sugar futures continue to slide, as market sentiment turns bearish.
• Weak demand and strong global supply are keeping downward pressure on prices.

🔹 EU Sugar Market: Prices Failing to Gain Traction 🇪🇺

• Despite strong efforts to raise prices in the EU, producers are unable to enforce increases.
• Polish sugar is currently being offered at EUR 0.55/kg DAP, significantly undercutting prices in Germany and other regions.
• EU sugar producers are struggling to absorb overproduction, both in the domestic and global market.

🔹 Oversupply Weighs on the Market ⚖️

• Global sugar stocks remain high, limiting price recovery.
• Exports from the EU remain weak, failing to offset the domestic surplus.

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🔮 3-Day Price Forecast (12.03 – 14.03.2025)

📉 Expected Price Movements:

• ICE Sugar No. 5 (May 2025): 515 – 525 USD/t (478 – 487 EUR/t)
• EU Sugar (FCA Price): 0.50 – 0.53 EUR/kg

🔍 Market Outlook:

• Prices are likely to remain weak, with further downside risk unless demand picks up.
• EU prices may continue to struggle, as Polish sugar and other regional competition prevent increases.

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📉 Global Sugar Stocks & Trade Balance

Year	Production (Mio. t)	Consumption (Mio. t)	Ethanol Use (Mio. t)	Imports (Mio. t)	Exports (Mio. t)	Ending Stocks (Mio. t)
2021/22	17.0	18.0	2.4	1.9	1.0	4.0
2022/23	16.5	17.8	2.6	2.1	0.9	3.8
2023/24	15.9	17.5	2.5	2.5	0.7	3.5
2024/25 (Forecast)	16.2	17.3	2.4	2.7	0.6	3.3

📌 Key Takeaways:

• EU sugar stocks remain high, limiting price recovery.
• Imports continue to flow into the market, despite weak demand.
• Ethanol production remains steady, keeping sugar allocations balanced.

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🔍 Conclusion & Recommendations

📌 Key Takeaways:
✅ Sugar prices continue to decline as demand remains weak.
✅ EU sugar industry struggles to enforce price hikes, with oversupply weighing on the market.
✅ Polish sugar is significantly cheaper, increasing price pressure within the EU.
✅ Further market weakness is expected unless exports increase or demand strengthens.

📊 Market Strategy:
🔹 Buyers: Monitor the market for further declines, as oversupply could create additional buying opportunities.
🔹 Sellers: Expect continued pressure, making strategic sales difficult.
🔹 Traders: Watch for support levels at 515 USD/t (478 EUR/t) for short-term positioning.

🚀 Stay informed & trade strategically!