FX.co ★ Sugar Falls Toward 4-Year Low

Sugar futures declined to approximately 16.1 cents per pound, nearing the four-year low of 15.5 cents observed earlier in July. This trend can be attributed to signs of strong production from Brazil. According to industry group Datagro, Brazilian mills plan to accelerate the rate of sugar crushing rather than channeling sugarcane toward biofuel production, thereby boosting sugar supply in the market. This strategy aligns with the drop in crude oil prices, influenced by heightened OPEC+ output and trade tensions involving tariffs on Brazil, which diminish the profitability of converting sugarcane into ethanol. Concurrently, the progression of the monsoon season in India has supported favorable planting conditions and the potential for recovery in production, posing a factor that could exert downward pressure on prices through 2026.