Historical Drop in Sugar Prices: Lowest in 5 Years!

While significant fluctuations are being observed among agricultural products in global commodity markets, sugar prices have dropped to their lowest level in the last five years. The price of sugar traded on the Intercontinental Exchange in the USA has fallen to $0.1421 per pound. This is recorded as the lowest value seen since December 2020.

Since the end of 2024, the sugar prices have experienced a decline of over 25%, indicating a significant downward trend in the market. Among the main reasons for this decline are strong production forecasts in countries such as Brazil, Thailand, and India. Producers are increasing sugar supply through high efficiency, consequently causing prices to move downward.

In Brazil, the world's largest sugar producer, the increase in corn-based ethanol production is noteworthy. The rise in ethanol production has restricted ethanol production from sugarcane, leading to an increase in sugar supply. This situation significantly contributes to pushing sugar prices down in the markets. This shift in ethanol production enhances Brazil's influence in the sugar market while also affecting international prices.

On the other hand, the increasing global supply creates uncertainty among market players, raising concerns that prices could fall further. Experts emphasize that this situation may create a favorable process for consumers but a challenging one for producers. It is anticipated that these fluctuations in the sugar market will also impact other agricultural products and commodity prices.