Raw and white sugar futures traded on ICE reached their strongest levels in more than a year on Thursday as market participants weighed the risk of supply reductions tied to El Nino weather patterns and the possibility that India may enter the import market.
Raw sugar advanced 0.7% to 17.68 cents per pound at 1308 GMT, after earlier touching 17.99 cents in the session. That intraday peak marked the highest reading for the contract in over a year.
Traders cited sharply elevated domestic sugar prices in India as a factor that could push the world’s second-largest sugar producer to seek imports. In an effort to limit further domestic price pressure, the Indian government has ordered bulk consumers who use more than 10 metric tons of sugar per month to restrict their inventories to no more than a 15-day supply.
Supply-side concerns were further underscored by Brazil’s national crop agency, Conab, which on Thursday projected that the country’s sugar production will decline by 2.9%, to 42.9 million tons in the 2026/27 season. That projected drop in output from Brazil - a leading global sugar supplier - added weight to the market rally.
White sugar posted an even larger percentage gain, climbing 1.6% to $550.70 per ton after reaching $564.40, a level not seen since March 2025. The surge in both raw and white contracts reflects trader sensitivity to potential production disruptions and shifting demand patterns.
Market participants said the combined effect of weather risk in key producing regions and the potential for India to switch from domestic supply reliance to imports drove speculative and commercial buying through the session. The prospects for lower Brazilian output, as signaled by Conab, reinforced those dynamics.
Market context
- ICE raw and white sugar futures hit their highest levels in over a year on Thursday.
- Raw sugar traded at 17.68 cents per pound at 1308 GMT after an earlier high of 17.99 cents.
- White sugar moved to $550.70 per ton after peaking at $564.40, its strongest since March 2025.
Observers noted policy steps in India to curb inventories among large industrial users and the Conab forecast for lower Brazilian production as near-term drivers of price strength. The situation leaves market participants watching weather developments and Indian domestic price trends for further signals on supply and demand balance.