The sugar market is monitoring India, weather, and US tariffs

The international sugar market remains attentive to supply prospects for the coming months, amid uncertainties about production in India, climate risks associated with El Niño, and the impacts of new tariffs imposed by the United States on Brazilian sugar. This assessment comes from Marcelo Di Bonifacio Filho, Market Intelligence Analyst at StoneX.

According to the expert, although the Indian government has not yet announced any official measures, the sector itself is already discussing the possibility of authorizing sugar imports to curb rising prices in the domestic market. He believes the debate highlights the difficulties the country faces in balancing tighter stocks, growing demand for ethanol, and two sugarcane harvests below potential, a scenario that could be further aggravated by El Niño.

Di Bonifacio also points out that the new US tariffs on Brazilian sugar tend to reduce the competitiveness of exports to that market. As a result, some of the supply may be redirected to other destinations, increasing availability in the international market and putting downward pressure on prices.

Despite the volatility recorded throughout the week, the analyst states that prices continue to react primarily to expectations surrounding global supply and the performance of major producing countries, rather than to actual changes in short-term fundamentals.