Sugar prices soften a bit on indications of increased production in Brazil

19-Jun-2024 07:58 PM

New York (Bharti Agri App). Sugar prices softened a bit in New York and London on indications of increased production in Brazil, the world's largest sugarcane producing country.

The futures price of raw sugar in the New York Exchange for July contract fell by 0.06 cents per pound (0.32%) and the futures price of white sugar in the London Exchange for August delivery fell by $1.90 per tonne (0.35%).

It is worth mentioning that the apex body of the Brazilian sugar industry - UNICA had released a report on June 14, in which the domestic production of sugar during the month of May was estimated to have increased by 11.8% to 78.37 lakh tonnes in comparison to last year.

The contribution of the use of sugarcane in the production of sugar was also said to have increased from 46.68% to 47.88%. After the release of this report of UNICA,

the global futures price of sugar started coming under pressure, which is still intact. It is known that Brazil is the world's largest producer and exporter of sugar.

The weakness in Brazil's currency - Real also had a negative impact on the price of sugar. The exchange rate of Real against the US dollar fell to the lowest level in the last 17 months,

which increased the possibility of sugar exports. But when the Indian Meteorological Department broadcast the information on June 18 that monsoon rains were 20 percent less than the normal average,

then the price of sugar strengthened slightly due to increased buying for short covering in New York and London. Good monsoon rains are required for sugarcane crop in India.

On the other hand, sugar production is expected to increase in Thailand and the European Union. In the entire season of 2024-25, global production of sugar is estimated to be about 55 lakh tonnes more than its use....