Sugar Prices Find Support as Safras Lifts 2026/27 Outlook

Sugar prices recently came under pressure, sliding to five-week lows last Thursday, after renewed expectations of higher exports from India weighed on the market. The decline followed comments from India’s food secretary indicating that the government may allow additional sugar exports to ease excess domestic supply. Earlier, India’s food ministry confirmed plans to permit mills to export 1.5 million metric tonnes (MMT) of sugar during the 2025/26 season. India had introduced export quotas in 2022/23 after adverse weather reduced output and tightened local supplies.

India and Brazil Supply Outlook Pressures Prices

Rising production forecasts in India, the world’s second-largest sugar producer, have added to the bearish tone. On November 11, the India Sugar Mill Association (ISMA) raised its 2025/26 sugar production estimate to 31 MMT from 30 MMT, representing an 18.8% year-on-year increase. ISMA also revised down the amount of sugar expected to be diverted to ethanol production, cutting its estimate to 3.4 MMT from a previous 5 MMT. This adjustment could leave more sugar available for exports. Supporting this view, ISMA reported that sugar production between October 1 and December 15 surged 28% year-on-year to 7.83 MMT.

Brazil’s outlook has also contributed to downside pressure. Conab, Brazil’s crop forecasting agency, increased its 2025/26 sugar production estimate to 45 MMT from 44.5 MMT. Data from Unica showed that cumulative Center-South sugar output through November rose 1.1% year-on-year to nearly 39.9 MMT. Additionally, a larger share of sugarcane has been allocated to sugar production, with the crushing ratio rising to 51.12%.

Global sugar supply dynamics explained: how rising output from Brazil, India and Thailand is reshaping sugar price forecasts and export expectations.

Global Surplus Expectations Weigh on the Market

On a global level, the International Sugar Organization (ISO) now expects a 1.625 MMT surplus in the 2025/26 season, reversing a 2.916 MMT deficit recorded in 2024/25. The ISO attributed the surplus to higher output in key producers such as India, Thailand, and Pakistan, while forecasting global sugar production to rise 3.2% year-on-year to 181.8 MMT. Sugar trader Czarnikow echoed the surplus narrative, raising its 2025/26 surplus estimate to 8.7 MMT.

Thailand and USDA Forecasts Reinforce Supply Growth

Thailand’s production outlook remains another bearish factor. The Thai Sugar Millers Corporation projected a 5% year-on-year increase in the 2025/26 crop to 10.5 MMT. Meanwhile, the USDA expects global sugar production to reach a record 189.3 MMT in 2025/26, with consumption also hitting record levels. Despite higher demand, ample supply growth continues to shape price expectations.

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