Global sugar market price softens due to possibility of increased production in India

09-Jul-2024 06:22 PM

New York. With the forecast of more than normal southwest monsoon rainfall in India and a good increase in sugarcane sowing area, the possibility of better sugar production during the 2024-25 marketing season (October-September) has increased.

This is putting pressure on prices in the global market. The futures price of raw sugar for the October contract on the New York Exchange fell by 0.09 cents per pound or 0.45 percent on the previous day. Similarly,

the futures price of white sugar on the London Exchange fell by 2.30 percent to $ 13.20 per tonne for August delivery. 

According to the Indian Meteorological Department, in the current season of southwest monsoon, from June 1 to July 7, the country received 225.7 mm of rain, which is about 2 percent more than the long-term average of 221.6 mm for this period. 

Sugar prices are under pressure due to another reason. The apex industry body ISMA has estimated that the industry will have a huge surplus stock of 91 lakh tonnes of sugar at the end of the current marketing season of 2023-24,

which is 36 lakh tonnes more than the domestic demand and consumption of the first three months of the upcoming marketing season.

ISMA has also urged the government to allow the export of this additional sugar. It is known that there is an indefinite ban on the export of sugar from India.

It is known that for the marketing season of 2022-23, the government had allowed the export of 61 lakh tonnes of sugar,

the time period of which expired on 31 May 2023. After that the ban on export came into force. Sugar production is once again seeing a good increase in the most prominent producing and exporting country - Brazil.

According to the report of apex industry body UNICA, sugar production in Brazil during the period from 1 April to 15 June 2024 increased to 109.50 lakh tonnes, which is 14.4 percent more than last year.