
Brazilian crushing and rainfall drove price correction
"During the past week, the bears took control of the sugar market, causing prices to retreat to 18.96 c/lb after briefly reaching 20 c/lb the week prior, marking a nearly 4% drop week-on-week. This trend was influenced by rainfall in the Brazilian Center-South, alleviating concerns about a dry February and early March, and strong sugar cane crushing as reported by Unica. With favorable weather predictions and Brazil's expected healthy crop, we remain optimistic regarding 25/26. Though volatility may arise from developments in other producing countries, a healthy result from Center-South could smoothen out some of these impacts."
Brazilian crushing and rainfall drove price correction
- Prices dropped to 18.96 c/lb after briefly reaching 20 c/lb the previous week, marking a nearly 4% week-on-week decline.
- Rainfall in the Brazilian Center-South alleviated concerns about a dry February and early March, contributing to the price drop.
- Unica reported strong sugar cane crushing, suggesting a robust 24/25 result with the possibility of exceeding 620 million tons of cane.
- Favorable weather forecasts for April, May, and July indicate a positive outlook for the Brazilian 25/26 crop, restricting price support.
- Brazil's increased share in the international trade market rose its importance regarding price volatility, being able to smoothen out, or worsen, the impact that other regions could drive.
- We are approaching the time of year when the market monitors both the start of the Center-South crop and the development of crop conditions in the Northern Hemisphere
During the past week, the bears took control of the sugar market. Prices retreated after briefly reaching 20 c/lb the week prior. Following four consecutive reductions, raw sugar closed on Friday, the 28th, at 18.96 c/lb, marking a nearly 4% drop week-on-week. Therefore, it is interesting to understand why the sweetener has faced such resistance at the 20 c/lb level and what could still support its price.
One of the main reasons behind this trend was the rainfall recorded in the Brazilian Center-South, which possibly alleviated some concerns regarding dry conditions in February and first half of March.
Image 1: Cumulative Rainfall Estimated to Center-South (mm)

Source: Bloomberg, Hedgepoint
Image 2: Bi-weekly cane crushing at Center-South mills (Mt)

Source: Unica
Image 3: Long-term precipitation anomaly forecast (mm)

Source: Inmet
Image 4: Brazilian share on total exports (%)

Source: Green Pool, Hedgepoint
Image 5: Total Trade Flows (‘000tq)

Source: Green Pool, Hedgepoint
In Summary
Weekly Report — Sugar
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