SUGAR MARKET HEADS TOWARDS SURPLUS, BUT LOGISTICAL BOTTLENECKS HOLD BACK THE SECTOR

The global sugar market is expected to shift from a deficit to a surplus in the upcoming season, with a forecasted 2.7 million tonne excess. This projection relies on stable sugar prices to encourage Brazilian producers to prioritize sugar over ethanol. Improved weather has boosted production in India, Thailand, and Brazil, but logistical challenges in Brazil could limit exports, as ports are set to handle record corn and soybean crops. A new port terminal by COFCO may ease pressure, but high transport costs could still push mills to favor ethanol. Even a 1% shift toward ethanol could reduce Brazilian sugar output by 800,000 tons. After years of shortages, global stocks need rebuilding, but price incentives remain crucial to sustaining production amid climate uncertainties, according to market experts at the Dubai Sugar Conference.
Source: Nova Cana