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Sugar Market In Turmoil: Brazil’S Crisis Sparks Global Supply Concerns
(MENAFN- The Rio Times) The global sugar market faces upheaval as Brazil's production woes send shockwaves through the industry.
Wildfires and drought have ravaged the world's largest sugar producer, forcing traders to seek alternatives. Thailand and India have emerged as potential saviors of the sugar supply.
Brazil's sugar fields have fallen victim to adverse conditions. Fires have consumed over 59,000 hectares of sugarcane crops in São Paulo state.
In addition, drought compounds the problem, with parched earth and dwindling rivers hampering production efforts. The impact on Brazil 's sugar output has been severe.
Rabobank slashed its forecast for the 2024/25 season to 39.3 million metric tons. Green Pool Commodity Specialists estimate that up to 5 million metric tons of sugarcane may have been lost to the fires.
As Brazil struggles, the market has turned to other major producers. Thailand, the second-largest exporter, offers hope.
Analysts predict a recovery in Thai sugar production for the 2024–25 season, with estimates suggesting an increase to 10.2 million metric tons.
However, Thailand faces its own challenges. Recent floods have raised concerns about potential harvest delays. Thai sugar millers report the lowest yield from crushed cane in over a decade.
India's Sugar Industry
India, the world's second-largest sugar producer, presents a complex picture. The country's sugar production for 2024–25 is expected to reach 30 million metric tons.
However, this marks a decrease of 2 million metric tons from the previous year. India's focus on ethanol production has diverted some sugarcane away from sugar manufacturing.
The Indian government has extended restrictions on sugar exports to maintain domestic price stability. This policy decision limits India's ability to alleviate global supply pressures.
The sugar market 's volatility has led to dramatic price increases. New York sugar futures have climbed 19% in September alone. London sugar prices have also surged, reaching a two-and-a-half-month high.
The International Sugar Organization forecasts a global sugar deficit of 3.58 million metric tons for 2024/25, dwarfing the estimated 200,000-metric-ton deficit for the current season.
Climate change looms large over the sugar industry's future. Experts predict more frequent and severe droughts in key growing regions. These environmental challenges may further strain global sugar production in the coming years.
In short, as the situation unfolds all eyes remain fixed on weather patterns, government policies, and production shifts in sugar-producing nations.
The sweet success of the sugar industry depends on its ability to weather the storms ahead, both literal and figurative.
Wildfires and drought have ravaged the world's largest sugar producer, forcing traders to seek alternatives. Thailand and India have emerged as potential saviors of the sugar supply.
Brazil's sugar fields have fallen victim to adverse conditions. Fires have consumed over 59,000 hectares of sugarcane crops in São Paulo state.
In addition, drought compounds the problem, with parched earth and dwindling rivers hampering production efforts. The impact on Brazil 's sugar output has been severe.
Rabobank slashed its forecast for the 2024/25 season to 39.3 million metric tons. Green Pool Commodity Specialists estimate that up to 5 million metric tons of sugarcane may have been lost to the fires.
As Brazil struggles, the market has turned to other major producers. Thailand, the second-largest exporter, offers hope.
Analysts predict a recovery in Thai sugar production for the 2024–25 season, with estimates suggesting an increase to 10.2 million metric tons.
However, Thailand faces its own challenges. Recent floods have raised concerns about potential harvest delays. Thai sugar millers report the lowest yield from crushed cane in over a decade.
India's Sugar Industry
India, the world's second-largest sugar producer, presents a complex picture. The country's sugar production for 2024–25 is expected to reach 30 million metric tons.
However, this marks a decrease of 2 million metric tons from the previous year. India's focus on ethanol production has diverted some sugarcane away from sugar manufacturing.
The Indian government has extended restrictions on sugar exports to maintain domestic price stability. This policy decision limits India's ability to alleviate global supply pressures.
The sugar market 's volatility has led to dramatic price increases. New York sugar futures have climbed 19% in September alone. London sugar prices have also surged, reaching a two-and-a-half-month high.
The International Sugar Organization forecasts a global sugar deficit of 3.58 million metric tons for 2024/25, dwarfing the estimated 200,000-metric-ton deficit for the current season.
Climate change looms large over the sugar industry's future. Experts predict more frequent and severe droughts in key growing regions. These environmental challenges may further strain global sugar production in the coming years.
In short, as the situation unfolds all eyes remain fixed on weather patterns, government policies, and production shifts in sugar-producing nations.
The sweet success of the sugar industry depends on its ability to weather the storms ahead, both literal and figurative.
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