Thai raw sugar prices hit 22-month high amid Brazil supply concerns

Thai raw sugar prices rose to a 22-month high Oct. 15, driven by rising concerns over tightening global supplies after persistent wet weather disrupted cane crushing operations in Brazil's Center-South region.

Platts-assessed Thai HiPol raw sugar flat price reached $21.84/mt Oct. 15, up 1 cent/mt week over week, its highest level since Dec. 12, 2024, when it was assessed at $22.48/mt. ICE New York No. 11 March (H) 2026 futures settled at 20.84 cents/lb at the 0830 GMT Asian close Oct. 15, rising 2.57 cents/lb since the previous month.

S&P Global Energy CERA revised its 2025-26 global sugar balance from a 1.36 million mt surplus to a 0.54 million mt deficit, citing reduced Brazil CS cane crush in September amid persistent above-average rainfall.

Despite the price surge, several market participants in Asia expressed skepticism about the durability of the move, pointing to more fund activity rather than any significant shift in physical market fundamentals..

"I do not think fundamentals have changed much. It is mainly funds buying linked to El Niño risk," a Singapore-based sugar trader said.

The sentiment was echoed by two other Singapore-based sugar trade sources, who said sugar fundamentals have not changed materially.

"It is more a case of funds buying into the March contract rather than something fundamentally driven," a second Singapore-based trader said. "I do not think the market is that tight, even with the Brazilian downgrades, as demand remains slow."

While Brazilian production estimates have been revised lower, the ultimate impact on output remains uncertain.

"Brazil's Center-South sugar production looks to be around 37 million mt at best," the first Singapore-based trader said, adding that there remains scope for conditions to improve later in the season, allowing harvesting and crushing activity to recover.

A Singapore-based sugar analyst said their Brazil sugar crop forecast had been reduced to around 37.2 million mt, attributing it to excessive rainfall, which impacted crushing activity.

In the physical Thai raw sugar market, trading liquidity remained subdued, while Thai HiPol March-contract premiums were heard slightly lower amid limited spot purchasing activity.

March contract (H) offer and bid were heard at plus 61 points and 60 points, respectively, a Thai sugar trade source said.

Platts assessed the FOB premium for Thai HiPol raw sugar 2027 March-May 15 shipment down 5 points week over week at 61 points over ICE New York No. 11 March (H) 2026 futures. Platts assessed the FOB premium for Thai HiPol raw sugar spot October shipment stable week over week at 100 points over ICE New York No. 11 March (H) 2027 futures.