Arabfields, Adel Serai, Economic Analyst Arabfields — Global sugar prices have climbed to their highest levels since December 2024, as adverse weather in major producing countries raises concerns about harvests and the availability of supplies in the months ahead.

Raw sugar futures in New York rose sharply in early October, gaining nearly 8% over the previous week before reaching a peak not seen since late 2024. The rally reflects growing concerns that excessive rainfall in Brazil, combined with weaker production prospects in India and parts of Europe, could tighten the global market.

Brazil, the world’s largest sugar producer and exporter, is at the centre of the latest price movement. Persistent rainfall has disrupted sugarcane harvesting and processing in the country’s key south-central growing region, delaying field operations and reducing the volume of cane available to mills.

For workers and farming communities, the disruption extends beyond commodity markets. Harvest delays can affect mill operations, seasonal employment and the movement of sugar to export terminals. Producers must also decide how to allocate available cane between sugar and ethanol, a choice that can influence both domestic energy supplies and international sugar prices.

Production figures point to mounting pressure. A survey of analysts published in October projected south-central Brazil’s sugar output at 2.70 million metric tonnes in the second half of September, down 14.3% from the same period a year earlier. Cane crushing was expected to decline by 5.5% to 38.73 million tonnes, reflecting the impact of unfavourable weather on the harvest.

Brazil is not the only source of concern. India, the world’s second-largest sugar producer, has faced a weak monsoon season, with output projections for 2026/27 placing production at around 30 million tonnes. In the European Union, drought-related damage has also weakened expectations for the coming sugar-beet harvest.

These developments have altered the market outlook. Earlier expectations of comfortable global supplies have given way to concerns that production could fall short of consumption if weather disruptions persist. The International Sugar Organization estimated in August that the global sugar market would move from a surplus of 1.1 million tonnes in 2025/26 to a small deficit of 200,000 tonnes in 2026/27.

Consumption is expected to continue growing, reaching approximately 180.4 million tonnes in the 2026/27 season, according to the organisation. That leaves the market increasingly sensitive to any further deterioration in output from major producing countries.

The next several months will be crucial. If heavy rainfall continues to delay Brazil’s harvest and production disappoints in India and Europe, sugar prices could remain elevated and potentially test recent highs. A recovery in harvesting conditions, stronger-than-expected production or weaker demand could, however, limit further gains.

For food manufacturers and consumers, sustained increases in sugar prices could add to production costs, although the extent of any impact on retail prices will depend on local supply chains, currency movements and government policies.

The current rally does not guarantee a prolonged price increase. But with global consumption rising and weather risks threatening output across several major producing regions, the sugar market enters the final months of 2026 facing a narrower margin for supply disruptions.