FX.co ★ Sugar Futures at 3-Week High

Sugar futures increased by over 2.5%, reaching beyond 14.8 cents per pound, marking their highest point since October 24. This rise is largely attributed to a rise in oil prices and the appreciating Brazilian real. Higher crude oil prices enhance ethanol demand, prompting mills to divert their focus from sugar production to ethanol, consequently reducing sugar output. Nonetheless, market fundamentals have remained consistent, with a significant global surplus anticipated due to robust harvests in Brazil, India, and Thailand. Recent figures from UNICA indicate that sugar production in Brazil's central-south sugar area experienced a 16.4% rise, reaching 2.07 million metric tons in the latter half of October compared to the previous year. Concurrently, India has confirmed that it will permit sugar mills to export 1.5 million tons of sugar in the 2025-26 season, thereby adding to global stocks.