Sugar market at a turning point โ price surge fizzles out, demand remains weak
๐ฝSugar market at a turning point โ price surge fizzles out, demand remains weak
After last week's strong fluctuations, ICE Sugar No. 5 prices reversed again. The May 2025 contract fell by 2.10% to USD 552.40/t on Friday, only to rebound to USD 564.00/t on Monday and then lose ground again to USD 552.40/t in today's session. The market remains volatile, shaped by speculative flows and moderate demand. EU spot prices remain stable between EUR 0.50 โ 0.53/kg FCA, while producers continue to push new crop contracts at EUR 0.62/kg FCA.๐ ICE Sugar No. 5 Prices (USD/t)
Date: 21 March 2025(Exchange rate: 1 USD = 0.93 EUR)
๐ Market Drivers & Context
- Profit-taking and technical selling led to Friday's losses.
- Todayโs weak opening shows uncertainty, even after previous speculative buying.
- EU spot market remains oversupplied, despite claims from producers that prices must rise.
๐จ๐ช EU Sugar Market
- Spot prices stay at EUR 0.50 โ 0.53/kg FCA.
- Polish sugar undercuts many Western EU offers.
- Producers still offer EUR 0.62/kg FCA for Q4/2025 contracts.
- But: โIf they expect rising prices, why sell now?โ
๐ Global Supply & Demand Factors
- India & Thailand report reduced harvests, but exports remain stable.
- Brazilโs logistics are running smoothly, supporting overall supply.
- No extreme tightness observed โ global trade is balanced.
๐ฎ 3-Day Price Forecast (25 โ 27 March 2025)
Outlook: Without clear demand or supply shocks, the market is likely to remain volatile within this band. Profit-taking and speculative flows dominate.๐ Fundamentals: Global Balance Sheet
๐ Conclusion & Strategy
- โ Prices remain highly volatile and driven by technical flows.
- โ EU producers have little pricing power in the spot market.
- ๐ Forward offers above EUR 0.62/kg remain speculative and unsupported by current demand.
๐น Recommendations:
- Buyers: Secure coverage gradually; no urgency.
- Sellers: Use short-term rallies for hedging.
- Traders: Watch support at 550 USD/t (EUR 511/t) and resistance at 570 USD/t (EUR 530/t).
