London: Raw sugar prices are anticipated to register an annual gain of nearly 20% in 2024, as the global market shifts into a deficit in the upcoming season, according to a Reuters poll of 12 traders and analysts.
The poll’s median forecast suggests that sugar is poised to close the year at 24.5 cents per lb, reflecting a 5% increase compared to the close on Tuesday and a potential 19% rise above the levels observed at the end of the previous year.
Despite a modest decline in the cane crop, output in Centre-South Brazil, the leading production region, is expected to remain robust as mills prioritize sugar production over biofuel ethanol. However, the second-largest producer, India, is anticipated to experience a reduction in production.
The sugar market faces challenges, and relying solely on a single supply source is deemed unhealthy, with Centre-South Brazil alone unable to sustain the market, as per trader and supply chain services company Czarnikow. Without growth in India, global sugar production in the 2024/25 season is likely to decrease.
The poll’s median estimate suggests a global sugar surplus of 500,000 metric tons for the current 2023/24 season (October to September), which is expected to flip into a deficit of 700,000 tons in 2024/25.
