Every year, ‘s team of experts Hedgepoint publishes comprehensive reports on the global outlook for various agricultural commodities. On the blog, you can
Every year, ‘s team of experts Hedgepoint publishes comprehensive reports on the global outlook for various agricultural commodities. On the blog, you can already follow content published on coffee and soybeans and oilseeds. In this article, we’ll look at the short- and long-term trends for the sugar market in 2025.
Hedgepoint’s, market intelligence coordinator Lívea Coda, was responsible for this report sugar. According to the expert, the segment continues to experience strong volatility, driven by issues availability and macroeconomic. Check out the main below insights and have a good read!
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Outlook 2025 begins by discussing data economic on the market. As quoted in the document, the International Monetary Fund (IMF) indicates that global inflation should fall from 4.2% to 3.5% this year, with faster convergence towards the target in the advanced economies.
“As a result, the United States and the European Union are closer to achieving their goals than Brazil, India and China – countries directly related to the sugar sector,” says Coda.
The expert reports that there is concern about the persistence of US inflation and its strengthening due to the agenda of the new Trump administration. This anticipation has pushed the dollar to new highs by the end of 2024.
As Brazil is the main supplier of sugar, the devaluation of the real encourages local producers to sell on the market international. This Brazilian behavior contributed to a correction in the prices of the sweetener. However, the local currency recovered in January 2025 (falling below R$6 to the dollar), which limited new sales.
“The Monetary Policy Committee (COPOM) raised the Selic rate at its last meeting and indicated that further increases could occur in 2025. This move favors the Brazilian currency by suggesting a greater interest differential between Brazil and the United States – which could attract foreign capital,” adds Lívea.
However, the Hedgepoint professional points out that unresolved in fiscal issues Brazil still act as a barrier to further appreciation of the national currency. As a result, the level of the Brazilian real remains uncertain and could act either bullishly or bearishly for the sugar market.
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“After four years of deficit, the market world sugar is walking a tightrope. Brazil is moving towards a level of higher and more stable, but the availability Northern Hemisphere is still struggling. Our team of experts has observed a certain recovery, but most countries are still far from their historical capacity,” points out Lívea Coda.
In Brazil, soil moisture in the region Center-South improved, driven by favorable weather between November and January. Compared to previous years, the NDVI (Normalized Difference Vegetation Index) indicates a recovery in plant health, increasing their ability to absorb sunlight.
The Hedgepoint expert suggests a sugar production of 43.3 Mt on 25/26 in the producing region. In total cane, expectations also rise to 630 Mt.
Since the Covid-19 pandemic, ethanol has struggled to compete with sugar. Changes in fiscal policy followed by the end of the PPI have made it difficult for to react biofuel prices.
“For the 24/25 period, we estimate Otto cycle growth of 2.3% for central-southern Brazil and 5.8% for the northeast. For 25/26, given the expected economic challenges, growth should be more limited, at around 2% in each region,” he adds. Coda also reports that the estimate takes into account the change in the anhydrous blend from 27% to 30% in June 2025.
Another point raised in the outlook is biofuel stocks. According to the data, the increased availability with the crop 630 Mt combined with the expected expansion of corn ethanol keeps stocks at levels comfortable.
Lívea points out that higher tariffs in the United States could increase the domestic availability of biofuels in Brazil. In the last five years, the country has exported 500 million liters of ethanol to America and imported only 300 million liters.
If there is no trade between the countries, the average surplus of 200 million liters could remain in Brazil. This volume corresponds to less than 1% of Brazilian production, with a low expected impact on prices.
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Hedgepoint’s team of experts reports that India is a factor in bullish the short term. The country had close to average rainfall during cane development, which supports the projection of 30 million tons. However, if the harvest ends early, a global could emerge, further supporting prices deficit.
Thailand is moving in the opposite direction, with greater availability. In this country, the sugarcane area has expanded, and good weather conditions should recover production to more than 11 million tons in 2024/25, increasing its share of global flows.
Europe, meanwhile, considering an average detour of the product to is expected to produce 16.5 million tons of sugar ethanol. Increased availability in Ukraine could reduce imports from the European bloc and impact the planting of the next harvest.
Mexico showed better conditions for sugar cane development, but production is still expected to be below capacity. However, greater availability for is expected export .
The is expected to United States have greater domestic availability, reducing its dependence on international trade, especially considering the larger stocks of 24/25. Uncertainty over tariff revisions may lead the country to look for other sources of imports.
In terms of largest importer in sugar market demand, the country has shown excellent results. Its estimated production for the 24/25 harvest is 11Mt, reducing its need for imports. In addition, sugar production in China has already increased by 28% up to January, reaching 7.5 million tons.
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“Considering all the countries analyzed, two trends become clear short- and long-term. In the short term, it depends on availability in the Northern Hemisphere, a region with higher costs and reduced production capacity. This scenario creates a bullish trend that supports the contracts March and May,” says Coda.
In the long term, the expert points out that the other 2025 contracts, July and October, become bearish due to Brazilian availability. If the weather during the development of the Northern Hemisphere crop registers favorable conditions, October becomes the most bearish contract. This scenario could affect the contract March 2026.
In addition to these insights, you can check out the complete data in outlook 2025on the sugar market. Just go to the Hedgepoint HUB, register and check out the materials prepared by the experts.
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