Global raw sugar prices are projected to recover during the remainder of 2024 but are still expected to end the year with a slight annual loss of less than 3%. According to a recent Reuters poll of ten traders and analysts, prices are set to close at about 20 cents per pound, reflecting a 10.9% increase from Friday’s close but still 2.8% below the levels recorded at the end of the previous year.
This anticipated price recovery is attributed to a decrease in sugar production in Brazil’s key Centre-South region for the 2024/25 season, following a record cane crop in the prior season. The forecast for the cane crop in this region is 610.5 million metric tons, down from last year’s record of 654.4 million tons. Brazilian mills are expected to prioritize sugar production, utilizing 50.5% of the cane for sugar compared to 48.9% in the previous season.
Sugar production in the Centre-South is projected to be 40.9 million tons, a decline from 42.4 million tons in 2023/24. Analyst John Stansfield of DNEXT Intelligence SA noted that Brazil’s export pace cannot sustain record levels indefinitely, suggesting that a slowdown in exports could improve market outlook.
India, the second-largest sugar producer and top consumer, is expected to produce 30 million metric tons in 2024/25, down from 32.05 million in the previous year. Market participants are divided on whether there will be a global surplus or deficit in the upcoming season, with a median forecast indicating a marginal surplus of 780,000 metric tons, down from a surplus of 1.4 million tons in 2023/24.
In terms of white sugar, prices are forecasted to end the year at $545 per metric ton, marking a 5.5% increase from Friday’s close but still resulting in an annual loss of 8.6%.