Sugar futures surge on India tightness, weak demand

Sugar futures in New York were on track for their biggest weekly gain since May 2025, rising about 6%, as tight supplies in India drove prices. The most-active raw sugar contract rose as much as 1.2% on Friday after crossing 18 cents a pound on Thursday. Livemint reports that the Indian government allowed tax-free raw sugar imports of up to 1 million tons through October 31, a rare step for the world's second-biggest producer, to bolster supplies ahead of the festival season when demand usually peaks.

NDTV Profit notes that retail sugar prices in India have risen 20% and wholesale prices are up 30% in a month, linked to expectations of tighter supply due to weak rainfall and crop damage across major sugarcane-growing states. Livemint adds that the Indian decision surprised the market, which was evenly split on whether imports would be permitted. Analysts estimate 390,000 tons of raw sugar are already heading to India's refineries, with more cargoes potentially diverted to replenish local stockpiles.

However, demand remains weak globally. Brazil's mills are directing more cane to sugar production over ethanol, but buyers are refraining from placing orders amid the Iran conflict and Gulf refinery disruptions. The market's struggle to hold gains on Friday suggested the import news may already be priced in, according to StoneX.