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Informist, Wednesday, Oct. 8, 2025

 

MUMBAI – India's sugar output in the 2025-26 (Oct-Sept) season is expected to rise more than 26% to 35.3 million tonnes, according to FitchSolutions company BMI. The increase in output will result in greater participation by India in the global sugar market, it said.

 

Previously, India's sugar policy prioritised shielding domestic prices during periods of limited supply, resulting in strict export controls. However, with the current phase of relative abundance, and removal of ethanol production limits, policy emphasis is shifting toward supporting favourable returns for Indian sugar producers, according to the report. "This change in domestic market dynamics, coupled with recent policy signals, suggests a likely easing of India's export restrictions," BMI said in its report.

 

Successive seasons of improved output in both 2025-26 and 2026-27 are expected to facilitate a build-up in global stocks, potentially enabling India to increase its export quota further, BMI said.

 

India has not increased its ethanol blending target beyond 20%, which signals a slowdown in additional feedstock demand, it said. Furthermore, the country's increased use of grains in its ethanol programme is reducing its reliance on sugar as a primary feedstock, which could lead to higher exports of the sweetener.

 

GLOBAL OUTLOOK

BMI has revised the global sugar production in 2025-26 to 189.6 million tonnes from 185.9 million tonnes projected earlier. The upward revision can be attributed to higher output forecasts in Brazil and India. In Brazil, seasonal projection has been raised to 43.7 million tonnes from the earlier projection of 43.1 million tonnes, it said.

 

Moreover, 53.5% diversion of sugarcane towards sugar production as of Sept. 16 has also contributed to higher sugar availability globally.

 

Global sugar consumption is expected to reach 179.1 million tonnes in the 2025-26 season, up 0.2%, the report said. With growth in output set to outpace this rise in demand, the global production surplus is forecast to rise to 10.5 million tonnes in 2025-26.

 

In terms of prices, BMI has revised its annual price forecast for front-month Intercontinental Exchange-listed sugar futures to 17.5 cents per pound, down from previous projection of 18.0 cents per pound. Better-than-expected output in Brazil, a sharp upturn in Indian production, and weaker crude oil prices have contributed to an increasingly bearish sentiment through the third quarter of 2025, according to the report.

 

"As the (US) Federal Reserve navigates its rate-cutting strategy, movements in the funds rate will be a critical factor to monitor given their capacity to influence commodity market dynamics and, by extension, sugar prices," it said.  End

 

US$1 = INR 88.79

 

Reported by Taniva Singha Roy

Edited by Nishant Maher

 

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