Global Sugar prices prevailed divergent market trends during the first half of March 2025. This current price decline in Brazil during the review period influenced by government decision to eliminate import tariffs on food related products including Sugar.  Meanwhile, India’s sugar market remained stable, supported by steady domestic demand and government interventions such as stock limits and minimum price regulations.

In India, the prices remained stable during the first half of the month influenced by a more balanced gap between demand and supply. Insights gathered from various market participants suggest that Sugar production in India has reached approximately 247 lakh tonnes as of March 31, 2025, for the ongoing 2024-25 season.  Further, as per the data released by the Indian Sugar & Bio-Energy Manufacturers Association (ISMA) currently 95 mills are operating across the country indicating towards healthy manufacturing within the region.

Furthermore, production in key Sugarcane producing regions has remained modest. Uttar Pradesh one of the major producers of Sugar in the Indian market has produced 88 lakh tonnes of sugar with 48 mills still operational. This healthy production is driven by the improved yield of Sugarcane. Additionally, sugar recovery has shown improvement in the second half of the season, resulting in better output.  On the demand side, consistent enquiries from the domestic and international market were observed with no major fluctuation in the market reported.

Meanwhile, in Brazil, Sugar market remained volatile under the influence of various factors. Primarily, sugarcane crushing in Brazil’s center-south region fell by nearly 18% in the first half of March, driven by restricted planting in the region. Dry weather in the region amidst El-nino effect has hampered the overall yield of sugarcane in the region thus impacting the overall output. This decline in output has made consumers cautious. Additionally, the government decision to eliminate import tariffs on food related products including Sugar has exerted downward pressure on Sugar prices. This has eventually led to a surge in exports.  This surge in exports contributed to higher global supply, which, coupled with weaker demand, intensified the pressure on sugar prices.

As per ChemAnalyst, it is anticipated that the prices may remain volatile influenced by a variety of factors including declines in sugarcane crushing amidst unfavorable weather conditions and government’s stance on sugar export. Additionally, fluctuating crude oil prices may also impact the sugar prices through the ethanol-sugar balance. If crude oil prices rise, mills in Brazil and India may divert more sugarcane towards ethanol production, thereby reducing sugar availability and supporting prices.