Supreme Court’s US Tariff Rebuttal Pushes Sugar Prices Higher

March NY world sugar #11 (SBH26) on Friday closed up +0.23 (+1.63%), and May London ICE white sugar #5 (SWK26) closed up +3.30 (+0.82%).

Sugar prices rallied sharply on Friday, with NY sugar posting a 1.5-week high.  Sugar prices jumped on Friday after the US Supreme Court struck down President Trump’s tariffs, potentially allowing Brazil to export more sugar to the US, which would shrink global supplies.  Friday’s weaker dollar ($DXY) was also supportive for most commodity prices, including sugar.

Signs of lower sugar output in Brazil are also supportive of sugar prices, after Unica on Wednesday reported that sugar production in Brazil’s Center-South in the second half of January fell by 36% y/y to only 5,000 MT.  However, cumulative 2025-26 Center-South sugar output through January is up by +0.9% y/y to 40.24 MMT.  Also, the ratio of cane crushed for sugar rose to 50.74% in 2025/26 from 48.14% in 2024/25.

Last Thursday, sugar prices extended their 5-month-long plunge and posted 5.25-year nearest-futures lows on concern that a global sugar surplus will persist.  Last Wednesday, analysts from sugar trader Czarnikow said they expect a global sugar surplus of 3.4 MMT in the 2026/27 crop year, following an 8.3 MMT surplus in 2025/26.   Also, Green Pool Commodity Specialists said on January 29 that they expect a 2.74 MMT global sugar surplus for 2025/26 and a 156,000 MT surplus for 2026/27.  Meanwhile, StoneX said last Friday it expects a global sugar surplus of 2.9 MMT in 2025/26.

Consulting firm Safras & Mercado said on December 23 that Brazil’s sugar production in 2026/27 will fall by -3.91% to 41.8 MMT from 43.5 MMT expected in 2025/26.  The firm expects Brazil’s sugar exports in 2026/27 to fall by -11% y/y to 30 MMT.

The India Sugar Mill Association (ISMA) reported January 19 that India’s 2025-26 sugar output from Oct 1-Jan 15 was up +22% y/y to 15.9 MMT.  The ISMA on November 11 raised its 2025/26 India sugar production estimate to 31 MMT from an earlier forecast of 30 MMT, up +18.8% y/y, as India experienced its strongest monsoon season in five years.  The ISMA also cut its estimate for sugar used for ethanol production in India to 3.4 MMT from a July forecast of 5 MMT, which may allow India to boost its sugar exports.  India is the world’s second-largest sugar producer.