Global sugar surplus will be smaller than expected

The global sugar market is expected to post a surplus in the 2025/26 harvest, but smaller than expected. According to a report by StoneX, a global financial services company, the 2025/26 surplus was revised to 3,04 million tons, a cut of approximately 700 tons compared to the May estimate.

"On the global production side, a volume of 197,7 MMt is projected, an annual increase of 5%, due to the growth in supply from India and Thailand, and the maintenance of high volumes from Brazil," highlights Market Intelligence analyst Marcelo Di Bonifácio.

Regarding final stocks, estimates point to a 4,2% jump, totaling 75,4 million tons in the 2025/26 cycle. As Di Bonifácio shares, from now on, the consolidation of estimates will depend on the last two months of the monsoon season in Asia and, mainly, the Brazilian harvest.

The trend for the 2025/26 cycle is an increase in global demand, driven especially by strong growth in Asia (+1,5%) and Africa (+2,5%).

Expectations of additional volumes from Thailand and India

According to the StoneX report, the global sugar market continues to rely significantly on the production gains expected from India and Thailand, which, together, are likely to generate sufficient additional export volumes to offset potential supply shortfalls from Brazil in the 2024/25 cycle.

"Therefore, even if the 2024/25 deficit is larger than expected, at 4,54 million tons, much of the international harvest that is nearing its end has already been priced in. This scenario culminates in an estimated surplus in 2025/26 of 3,04 million tons," highlights the Market Intelligence analyst.

Regarding crops in Asia, production on the Asian continent promises a significant increase, approaching 80 million tons (gross value) in 2025/26, an annual expansion of 12% and close to what was recorded in 2021/22 – when India saw its production record.

In India, monsoon rains are 7% above normal from June to the end of July, but although monitoring the weather from now on is crucial, the market remains optimistic.

In this sense, StoneX maintained its production estimate of 32,3 million tons in the country in 2025/26, after diverting 4,5 MMt to ethanol.

As in India, Thailand received abundant rainfall in May, and currently, Thailand's climate trajectory for 2025 remains within expectations and showing clear improvements.

 In this regard, StoneX has not changed its forecast for Thailand. "Sugar production, in turn, is expected to rise 14% in 2025/26, to 11,4 million tons (tel quel), providing the country with a 1,5-2,0 million tonne increase in supply for exports, which are estimated at 8,5 million tons," notes the Market Intelligence analyst.

Brazil drives growth in the Americas

In the 2025/26 harvest, production in the Americas is expected to grow 2,7%, driven largely by Brazil. Despite the challenges faced in Brazil's Center-South region in 2025, particularly driven by the significant drop in ATR and lower productivity year-over-year, preliminary estimates for 2026 are on the optimistic side, with younger sugarcane fields expected—inherited primarily from the post-fire reforms of 2024.

"In this sense, based on current fundamentals, Brazilian supply in the 2025/26 international season (Oct-Sept) is estimated at 45,6 MMt (tel quel), an annual increase of 4%," shares Di Bonifácio. In Central America, StoneX estimates a small 5% growth, which can be considered a recovery compared to 2024/25 – when some countries suffered from excessive rainfall and crop failures, such as Nicaragua and El Salvador.

According to Di Bonifácio, there are only two months left in the 2024/25 international harvest (Oct-Sept), and the deficit for that period has already solidified. "Therefore, its size will depend on production performance in Brazil's Center-South region. This, in turn, is largely responsible for the 1,7 MMt cut in the estimated global surplus for the current cycle, now projected at -4,54 MMt (gross value)."

The direction of global demand for the 2024/25 harvest

Over the past five years, there has been a slowdown in global demand for sugar to an average of 0,7%, reflecting lower consumption by the European and American populations, and stability in large consumers such as the United States and Brazil.

Due to these global movements, StoneX cut around 200 tons in consumption in 2024/25 and just over 400 tons in estimated demand in 2025/26, which should reach 194,7 MMt (gross value), an annual increase of 0,7%.