CropGPT - Sugar - Week 20

CropGPT - Sugar

This week’s CropGPT podcast provides a structured overview of key developments shaping the global sugar market, with a focus on production trends, policy impacts, and trade shifts.

• India: In Visakhapatnam District, sugarcane cultivation has declined significantly—from 4,500 to under 3,000 hectares—following the closure of the Pemasengi Cooperative Sugar Mill and the NCS Sugar Factory due to outdated equipment and financial constraints. Local leaders are calling for government intervention to modernize the facilities and restore rural employment. Nationally, efforts to raise ethanol blending in petrol to 30% face obstacles from declining sugarcane yields caused by disease and erratic weather. While the fair remunerative price for sugarcane has been increased, balancing sugar and ethanol production remains a challenge.
• Brazil: The Center-South region reported a steep 49.35% year-on-year drop in sugarcane milling due to adverse weather, leading to a 53.79% fall in sugar output and a 35.37% drop in ethanol production. These declines have contributed to a 3% rise in global sugar prices on exchanges in New York and London. Additional market pressures stem from rising crude oil prices and a stronger Brazilian real, which may incentivize mills to shift production toward ethanol over exports.
• Ukraine: Ukrainian sugar producers are targeting growth in the MENA region, which already accounts for 90% of the country’s exports, to offset EU quota restrictions. Government support is viewed as vital to help Ukraine develop structured trade channels and establish itself as a more consistent global supplier, despite currently holding only a 0.2% share in the global sugar trade.
• Global Outlook: Market conditions vary widely, with production forecasts influenced by weather variability, policy changes, and energy-linked demand shifts. Brazil’s output drop and India’s evolving ethanol strategy are particularly impactful in shaping international supply and pricing dynamics.