iGrain India - Global sugar futures prices softened recently due to the possibility of rain in Brazil's central southern region, which is crucial for sugarcane production. Brazil, being the world's largest producer and exporter of sugar, produces 90% of its sugar in this region.
The rain is expected to benefit the sugarcane crop, which has been facing challenges due to a lack of sufficient rainfall. If the rain arrives as predicted, it could improve sugar production for the upcoming season, which starts in April 2025.
The possibility of increased sugar production led to a decline in global sugar futures. On the New York Exchange, the futures price for raw sugar in March fell by 0.31 cents per pound (a 1.42% decrease), while the London Exchange saw a drop of 6 dollars per ton (a 1.07% decrease) for white sugar.
The International Sugar Organization (ISO) recently revised its global sugar shortage estimate downward to 25.10 lakh tonnes from 35.80 lakh tonnes, further boosting expectations of better sugar availability. This change, along with the forecast of rain in Brazil, contributed to the softening of sugar prices.