October NY world sugar #11 (SBV25) on Tuesday closed up +0.26 (+1.60%), and August London ICE white sugar #5 (SWQ25) closed up +25.30 (+5.40%).

Sugar prices on Tuesday closed higher.  The USDA announced late Monday that the US will not import any specialty sugar beyond what is required by international trade laws, "in alignment with Secretary Rollins' Farmers First policies."

On the bearish side, Pakistan on Tuesday revised its sugar tender (with bids due July 22) sharply lower to 50,000 MT from its previous indication of a 300,000 MT tender.  Pakistan's cabinet on July 8 approved an increase in sugar imports to stop what it called artificially high domestic sugar prices.

Expectations for a sugar surplus in 2025/26 are bearish for sugar prices.  On June 30, commodities trader Czarnikow projected a 7.5 MMT global sugar surplus for the 2025/26 season, the largest surplus in 8 years.  On May 22, the USDA, in its biannual report, projected that global 2025/26 sugar production would increase by +4.7% y/y to a record 189.318 million metric tons (MMT), with global sugar ending stocks at 41.188 MMT, up 7.5% y/y.

Sugar prices have support from reduced sugar production in Brazil.  Unica reported Monday that the cumulative 2025/26 Brazil Center-South sugar output through June fell by -14.3% y/y to 12.249 MMT.  Last month, Conab, Brazil's government crop forecasting agency, said 2024/25 Brazil sugar production fell by -3.4% y/y to 44.118 MMT, citing lower sugarcane yields due to drought and excessive heat.

The outlook for higher sugar production in India, the world's second-largest producer, is bearish for prices.  On June 2, India's National Federation of Cooperative Sugar Factories projected that India's 2025/26 sugar production would climb +19% y/y to 35 MMT, citing larger planted cane acreage.  That would follow a -17.5% y/y decline in India's sugar production in 2024/25 to a 5-year low of 26.2 MMT, according to the Indian Sugar Mills Association (ISMA).  Also, the ISMA reported on July 7 that India's sugar production during Oct 1-May 15 fell -17% y/y to 25.74 MMT.

Sugar production in India is expected to benefit from forecasts for above-normal rains during the monsoon season (June-Sep).  On Monday, the India Meteorological Department reported that India's rainfall in June was 9% above normal and forecasted above-normal rain for July.

The outlook for higher sugar production in Thailand is bearish for sugar prices.  On May 2, Thailand's Office of the Cane and Sugar Board reported that Thailand's 2024/25 sugar production rose +14% y/y to 10.00 MMT.  Thailand is the world's third-largest sugar producer and the second-largest exporter of sugar.

The International Sugar Organization (ISO) raised its 2024/25 global sugar deficit forecast to a 9-year high of -5.47 MMT on May 15, up from a February forecast of -4.88 MMT.  This indicates a tightening market following the 2023/24 global sugar surplus of 1.31 MMT.  ISO also cut its 2024/25 global sugar production forecast to 174.8 MMT from a February forecast of 175.5 MMT.  

The USDA, in its bi-annual report released May 22, projected that global 2025/26 sugar production would climb +4.7% y/y to a record 189.318 MMT and that global 2025/26 human sugar consumption would increase +1.4% y/y to a record 177.921 MMT.  The USDA also forecasted that 2025/26 global sugar ending stocks would climb +7.5% y/y to 41.188 MMT.  The USDA's Foreign Agricultural Service (FAS) predicted that Brazil's 2025/26 sugar production would rise +2.3% y/y to a record 44.7 MMT  FAS predicted that India's 2025/26 sugar production will rise +25% y/y to 35.3 MMT due to favorable monsoon rains and increased sugar acreage.  FAS predicted that Thailand's 2025/26 sugar production will climb +2% y/y to 10.3 MMT.