Raw sugar futures collapsed to 14.37 cents per pound on October 28th, marking the lowest level since April 2021. The sharp decline follows bearish sentiment from last week’s São Paulo sugar conferences, where Brazilian production forecasts and Indian export potential raised concerns about mounting global oversupply.
Brazilian production forecasts for the 2026/27 season point to a record 44 MMT, representing a 3.9% year-on-year increase. This anticipated recovery comes as Brazil’s elevated sugar mix through October continues supporting production levels despite lower crushing volumes. From April through September, Center-South Brazil mills allocated 52.7% of cane to sugar production, up from 48.8% in the previous season.
India’s surplus inventory adds further pressure to global markets. The government is considering authorization of 2 MMT sugar exports for the 25/26 season, with industry sources identifying January-March as the optimal window before Brazilian supplies return to market. However, current price levels at four-year lows present challenges for export economics.
European markets reflected similar weakness, with Vesper Price Index DAP prices breaking below €500/mt in several countries to match last year’s levels. West-EU DAP prices declined 15% since May, falling from €600/mt to €510/mt by October 29th. The MARS October bulletin raised EU sugar beet yield forecasts to 76.3 t/ha, up from September’s 74.8 t/ha estimate and 4% above the five-year average.
The white premium closed at $417/mt on October 28th, while European prices saw regional variations with Spain’s VPI at €540/mt DAP, Germany at €505/mt DAP, Netherlands at €490/mt DAP, and Poland at €500/mt DAP.
October exports from Brazil reached 3.2 MMT through 18 working days, maintaining a daily pace of 177,800 tonnes and positioning the month to close higher than September. Industry consensus projects 25/26 Center-South Brazil crushing at 597 MMT, down 4% year-on-year and the lowest since 22/23, though early 26/27 forecasts signal recovery to 615 MMT.
Producers are adjusting contract structures in response to market pressures. Tereos reduced beet contract duration from five to three years, while Nordic Sugar and Danish growers agreed on 2026/27 terms featuring reduced demand of 345,000 tonnes white sugar and base prices of €31.50-32.00/tonne for clean beets.
The outlook remains bearish across all regions on ample supply, with Brazilian recovery and Indian surplus pressures maintaining downward momentum.
This news article is part of a more comprehensive market analysis. For the full analysis, visit: https://app.vespertool.com/market-analysis/2401.
