Sugar prices fell back on long liquidation pressure after the sharp August rally, with October NY world sugar #11 down 0.35 and October London ICE white sugar #5 down 4.10. Before falling back, both contracts posted new 1.25-year nearest-futures highs. The recent rally was sparked by concern about a weather-related decline in global sugar production, with drought and hot weather in Europe set to cut EU and UK sugar production to 14.98 MMT this year, the lowest level in 11 years, according to S&P Global Energy. Lower sugar output in Brazil is also bullish after Unica reported Brazil Center-South June sugar production fell 26.3% year-over-year to 3.903 MMT. Since posting a 5.25-month low on July 30, sugar prices have surged on the outlook for tighter future supplies, with Covrig Analytics now expecting a global sugar deficit in 2026/27 of -300,000 MT compared to a June forecast for a +100,00 MT surplus, Green Pool Commodity Specialists raising their global 2026/27 sugar deficit to -3.3 MMT from a June estimate of -1.76 MMT, and StoneX raising its 2026/27 global sugar deficit forecast to -1.7 MMT from a May estimate of -550,000 MT.
