Sugar Prices Recover as Buying Interest Returns – EU Prices Still Under Pressure

📉 Sugar Prices Rebound, but EU Market Faces Uncertainty Amid Industry Pricing Strategy

ICE Sugar No. 5 futures recovered with the May 2025 contract rising by 1.63% to USD 533.20/t (EUR 495.88/t). Meanwhile, the EU sugar industry is actively offering contracts for the next season at prices above EUR 0.62/kg FCA, citing expectations of higher prices in the next campaign. However, if prices are expected to rise, why are producers eager to sell now? The industry’s pricing strategy raises questions about market confidence, as geopolitical risks and production uncertainties remain—but so does the possibility of continued weak demand.

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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	533.20	€495.88	+8.70	+8.09	+1.63%
Aug 25	517.20	€480.99	+7.80	+7.25	+1.51%
Oct 25	511.30	€475.51	+7.40	+6.88	+1.45%
Dec 25	509.50	€473.84	+6.60	+6.14	+1.30%
Mar 26	511.00	€475.23	+5.80	+5.39	+1.14%
May 26	508.60	€472.99	+5.40	+5.02	+1.06%

📌 Exchange rate used: 1 USD = 0.93 EUR

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🌍 Key Market Drivers & Influences

🔹 EU Sugar Producers Push Contracts at EUR 0.62/kg – But Why Now? 🇪🇺

• Representatives of the sugar industry are actively offering new season contracts above EUR 0.62/kg.
• The reasoning? They claim that prices will rise further in the next campaign.
• But if producers truly expect higher prices, why are they already selling today?
• This suggests uncertainty rather than confidence, as sellers may not be convinced that prices will increase.

🔹 Geopolitical & Production Uncertainty Adds to Market Speculation 🌎

• Potential risks exist, including export bans, production shortfalls, or supply chain disruptions due to geopolitical events.
• However, it is just as likely that harvests will be strong and sugar consumption will continue declining.
• If producers were certain of rising prices, they would hold back sales—not rush to lock in contracts now.

🔹 EU Market Remains Weak Despite Global Price Rebound 📉

• Despite ICE Sugar No. 5’s recovery, EU sugar prices remain between EUR 0.50 – 0.53/kg FCA.
• Oversupply remains a key issue, and Poland continues to offer sugar at lower prices.
• The EU sugar industry is struggling to push through higher prices, despite earlier attempts.

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🔮 3-Day Price Forecast (13.03 – 15.03.2025)

📉 Expected Price Movements:

• ICE Sugar No. 5 (May 2025): 530 – 540 USD/t (492 – 502 EUR/t)
• EU Sugar (FCA Price): 0.50 – 0.53 EUR/kg

🔍 Market Outlook:

• Further consolidation is expected, with limited room for strong gains.
• Speculative buying may continue driving short-term price moves, but fundamental demand remains weak.

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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 stable, limiting major price swings.
• Imports continue to support supply, offsetting weaker domestic demand.
• Ethanol production remains unchanged, keeping sugar allocations stable.

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🔍 Conclusion & Recommendations

📌 Key Takeaways:
✅ Sugar prices rebounded due to short-covering and speculative buying.
✅ EU market remains weak, with no fundamental demand increase despite industry price push.
✅ Sugar producers are offering new contracts at EUR 0.62/kg FCA, but this raises questions.
✅ Further market consolidation is likely, with limited upside potential.

📊 Market Strategy:
🔹 Buyers: Be cautious—if prices were truly expected to rise, why are contracts already being offered?
🔹 Sellers: Secure contracts carefully; current pricing trends do not support a major increase.
🔹 Traders: Watch for potential resistance levels at 540 USD/t (502 EUR/t) for short-term positioning.

🚀 Stay informed & trade strategically!