Sugar Market Report
Sugar Market Report: Thursday, March 27, 2025
Sugar prices on international futures markets exhibited a downward trend today, reflecting a mix of supply-side pressures and broader economic influences. Here’s a detailed snapshot of the day’s movements based on the latest data from the Intercontinental Exchange (ICE).
Price Movements
- White Sugar #5 May ’25 (SWK25) [ICE/EU]: Closed at *$537.80 per tonne, down *$2.50 (-0.46%)**. This modest dip in white sugar futures, which represent the global benchmark for refined sugar, follows a pattern of softening prices seen earlier this week. Earlier today, at 9:37 AM CT, the contract was at $535.00, suggesting a slight intraday recovery before settling higher but still below yesterday’s close.
- Sugar #11 May ’25 (SBK25) [ICE/US]: Ended at *$19.09 per hundredweight (cwt), down *$0.26 (-1.34%)**. The raw sugar benchmark experienced a steeper decline compared to its refined counterpart, indicating broader bearish sentiment in the raw sugar segment.
Market Analysis
The slight dip in White Sugar #5 prices (-0.46%) contrasts with the more pronounced drop in Sugar #11 (-1.34%), highlighting divergent pressures across the sugar complex. Several factors likely contributed to today’s declines:
- Currency Dynamics: The U.S. dollar’s strength remains a headwind for sugar prices. A rallying dollar index, noted in posts on X earlier this week, triggered a 1.8% drop in white sugar prices to $524.40/tonne on March 24. Today’s continued softness suggests ongoing pressure from a robust USD, which raises costs for non-dollar buyers and prompts long liquidation among traders.
- Supply Outlook: Global supply optimism is weighing on futures. Brazil’s Center-South region crushed 566 million tonnes of sugarcane by late 2024, holding steady despite weather challenges, while Thailand anticipates an 18% production increase to 10.35 MMT for 2024/25. In India, production is pegged at 26.4 MMT this year, with expectations of a rebound in 2025/26. Forecasts of a global surplus (+2.7 MMT, per Green Pool) for the next season are tempering price support, even as current stocks remain balanced.
- Demand Signals: Demand appears lackluster. In India, domestic sugar releases fell 4.8% year-on-year to 137.50 LMT, and bulk buyers like Pepsi and Parle cut purchases by 15%. Globally, China’s sugar imports plummeted 97% in February to 20,000 MT, signaling a broader softening that may be influencing trader sentiment. Sugar #11’s sharper decline could reflect raw sugar’s exposure to industrial buyers scaling back amid cheaper alternatives like HFCS.
- Ethanol Competition: Falling crude oil prices earlier this month have reduced ethanol profitability, potentially shifting mill allocations toward sugar production in Brazil and India. This near-term supply boost might explain Sugar #11’s steeper drop, as raw sugar stocks grow.
White vs. Raw Sugar Divergence
The smaller decline in White Sugar #5 (-0.46%) versus Sugar #11 (-1.34%) suggests refined sugar is holding up better, possibly due to steady consumer demand for packaged goods outweighing industrial raw sugar use. White sugar’s premium over raw—historically around $100–$150/tonne—may be narrowing, but today’s data hints at resilience in refined markets despite the broader downturn.
Outlook
Today’s price movements are a correction from recent highs (e.g., White Sugar #5 hit $564.70 mid-March). The market appears caught between supply abundance and demand uncertainty, with the dollar acting as a swing factor. If oil prices stabilize or Indian festival demand picks up, prices could find a floor. For now, traders seem cautious, with Sugar #11’s bigger slide reflecting bearish bets on raw sugar oversupply
