LONDON: Raw sugar futures slumped to a five-year low on Wednesday, with the potential for a substantial global surplus in the 2025/26 season weighing on prices.
Dealers said an expected rise in sugar output in India, the world’s second-largest producer, was adding to concern over excess supplies as forecasts for the size of an anticipated 2025/26 global surplus begin to increase.
Raw sugar futures were down 0.1 percent at 14.21 cents per lb by 1445 GMT after setting a five-year low of 14.05 cents.
The rise in production has been driven partly by favourable monsoon rains this year while it appears that less cane than many expected is being diverted to produce ethanol.
“We now think that India will produce more sugar in 2025/26 at 32.8 million tons, due to less sucrose being diverted to ethanol,” broker Czarnikow said in a note.
India produced about 26.1 million metric tons in 2024/25.
Czarnikow raised its forecast for the 2025/26 global sugar surplus by 1.2 million tons to 8.7 million tons.
White sugar rose 0.1 percent to USD413.90 a ton.
Cocoa futures eased, pressured by continuing concern over weak demand after last year’s surge in prices.
Barry Callebaut said on Wednesday that it expected sales of cocoa products to decline by a percentage in mid-single digits in its coming financial year owing to continuing pressure from high cocoa prices.
The market also remains focused on weather in West Africa, where crops are being harvested.
“Wet weather may delay cocoa harvesting across southern Ghana and western Ivory Coast, and dry weather may favor Nigeria and Cameroon’s key crop areas,” LSEG Research and Insights said in a report on Wednesday.
New York cocoa lost 0.45 percent to USD6,570 a ton while London cocoa was 1.1 percent down at 4,797 pounds a ton.
Robusta coffee gained 0.3 percent to USD4,694 a ton while arabica coffee was up 1.6 percent at USD4.1190 per lb.
Comments
Comments are closed for this article.