Sugar Prices Hit Lowest Level in Four Years

(MENAFN) Sugar prices sank to their lowest level in four years on Wednesday, with a pound of the commodity dropping to $0.1626. That represents a 4% decline from the end of May and a 15% drop since the beginning of the year.

The primary driver behind the sharp decline is a projected increase in global sugar output. The U.S. Department of Agriculture (USDA) forecasts a 4.7% year-on-year rise in global sugar production for the 2025/26 season, with major gains expected in India, Thailand, and Brazil.

Anticipation of stronger-than-usual monsoon rains in India has further pressured the market, alongside geopolitical concerns—particularly the Iran-Israel conflict—which have fueled fears of dampened demand.

In addition, weak sugar imports from China and a slowdown in buying from Indonesia and Bangladesh have contributed to the downward trend in prices.

Analysts attribute much of the slump to favorable agricultural conditions.

Ole Hansen, head of commodity strategy at Saxo Capital, told a media outlet that “the simple explanation is good weather conditions in Asia, Central America, and Brazil, which are favoring crops and the production of sugar.”

Tore Alden, a senior analyst at Fastmarkets, echoed that sentiment, emphasizing improved weather patterns in key producing areas like Brazil.

“There has been a shift and growth in corn-based ethanol production in Brazil,” he stated to the media outlet. “Since they typically make ethanol from sugar, there has probably been more sugar available for the export market from Brazil than in the past.”

“Prices are down primarily due to the weather, following several years of La Nina in South America,” he added.

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