Sugar Market Report

Executive Summary:
The global sugar market is experiencing tight supply conditions as of February 20, 2025, leading to upward price pressure. India’s significantly reduced production for the 2024-25 crop year (October 2024 – September 2025) is a key driver, alongside earlier weather-related setbacks in Brazil. A projected global deficit of approximately 3.6 million metric tons (MMT) for 2024-25 is anticipated, although forecasts suggest a potential surplus in 2025-26 as production recovers.
Key Market Developments:

• India’s Production Decline:
• Estimates indicate a drop to 27 MMT, down from 31.9 MMT in the previous season, due to disease and weather impacts.
• This shortfall has driven a 6.5% increase in sugar prices over the past month.
• In response, India has approved 10 MMT of sugar exports to stabilize domestic supply.
• Brazil’s Production:
• The Center-South region faced earlier drought and fires, impacting production.
• Recovery is expected later in 2025.
• Global Supply and Demand:
• A global deficit of approximately 3.6 MMT is projected for 2024-25.
• Analysts at Green Pool project a potential surplus of 2.7 MMT in 2025-26, assuming production recovery in India and Brazil.
• Other Market Activities:
• Zimbabwe increased local sugar sales, reducing exports.
• Nigeria’s Dangote invested $700 million to boost domestic sugar production.
• Traders are calling for stricter New York exchange rules to prevent delivery delays.
  Projected Global Sugar Balance Sheet (2024-25 Crop Year):
  (Note: This is an approximation based on available data and projections from sources like the ISO, USDA, and industry analysts.)
• Opening Stocks: 95.0 MMT
• Production: 179.3 MMT
• Key factors: India’s reduced output, Brazil’s weather impacts, and a slight rise in Thailand’s production.
• Imports/Exports: 68.3 MMT (assumed stable)
• Consumption: 182.9 MMT (modest growth)
• Ending Stocks: 91.4 MMT
• Deficit: -3.6 MMT
• Stocks-to-Use Ratio: 36.4% (indicating tight supplies)
  Key Assumptions:
• Opening stocks are based on adjusted 2023-24 ending stock figures.
• Production reflects reduced output in India and Brazil, with some offset from Thailand.
• Trade flows are assumed to remain relatively stable, except for India’s export approval.
• Consumption growth is moderate, influenced by population trends and high prices.
• Ending stocks and deficit match closely with ISO estimations.
• Stocks to use ratio follows ISO alternative methodology.
  Market Implications:
• The projected deficit for 2024-25 supports current high sugar prices.
• The potential surplus in 2025-26 could shift market dynamics, especially if India’s production recovers as projected by the Indian Sugar and Bio-energy Manufacturers Association.
• The market remains sensitive to supply shocks, particularly those affecting India and Brazil.
• Monitoring the recovery of Brazils production is very important.