Global Sugar Production Surge Drives Market Prices Lower

Sugar prices have declined significantly as increased global production continues to pressure international markets. March New York world sugar futures fell 1.01 percent, while March London ICE white sugar dropped 0.90 percent, with London sugar reaching a 2.5-month low.

Brazil Maintains Production Leadership

Brazil's sugar sector demonstrates robust performance, with Unica reporting that the country's cumulative 2025-26 Center-South sugar output through December increased 0.9 percent year-over-year to 40.222 million metric tons. The proportion of cane crushed for sugar production rose to 50.82 percent in 2025-26 from 48.16 percent in the previous season.

Conab, Brazil's crop forecasting agency, has raised its Brazil 2025-26 sugar production estimate to 45 million metric tons from a previous forecast of 44.5 million metric tons, signaling record output expectations.

India Expands Market Presence

The India Sugar Mill Association reported substantial growth in the world's second-largest sugar producer, with 2025-26 sugar output from October through mid-January rising 22 percent year-over-year to 15.9 million metric tons. ISMA raised its full-season production estimate to 31 million metric tons, representing an 18.8 percent increase.

India's government may permit additional sugar exports to address domestic supply abundance. The food ministry has already authorized mills to export 1.5 million metric tons in the 2025-26 season, following the introduction of export quotas in 2022-23.

Market Outlook and Global Dynamics

Covrig Analytics projects a global sugar surplus of 4.7 million metric tons for 2025-26, though this is expected to decline to 1.4 million metric tons in 2026-27 as weak prices discourage production. The International Sugar Organization forecasts a 1.625 million metric ton surplus in 2025-26, driven by increased production in India, Thailand, and Pakistan.

Thailand, the world's third-largest producer and second-largest exporter, anticipates a 5 percent increase in 2025-26 production to 10.5 million metric tons, according to the Thai Sugar Millers Corporation.

Long-term Production Projections

The United States Department of Agriculture projects global 2025-26 sugar production will reach a record 189.318 million metric tons, representing a 4.6 percent increase. Global consumption is forecast to rise 1.4 percent to 177.921 million metric tons, while ending stocks are expected to decline 2.9 percent to 41.188 million metric tons.

Despite current abundance, consulting firm Safras & Mercado anticipates Brazil's sugar production will decrease 3.91 percent in 2026-27 to 41.8 million metric tons, with exports falling 11 percent to 30 million metric tons, suggesting potential market stabilization ahead.