- Big sugar drought all over the world!
- A deficit of as much as 6.28 million tonnes
- Now the rate will skyrocket?
Global Sugar Shortage Price Hike: While the prices of sugar in India were tight a few months ago, now a very big and shocking news is coming out regarding the supply of sugar. An important matter has been learned regarding the supply of sugar before the festival days. Market analyst Green Pool Commodities has forecast that global sugar supply is likely to decline by 6.58 million tonnes in 2026-27. The main reason for this is said to be climate and low production of crops. (Global Sugar Shortage Price Hike)
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All this has resulted in a steady increase in the price of sugar in the international and domestic markets. Brazil, India and the European Union have seen significant declines in sugar production. A huge increase in prices due to reduced supply of sugar is now going to put a huge strain on the common man's pocket.
What is this new sugar crisis?
Brazil's sugar production is down 14 percent this year compared to last year, due to unseasonal heavy rains in Brazil due to El Nino. In light of this dire situation, Green Pool has reduced its sugar production forecast for the central-south region of Brazil by 6 lakh tonnes to 37.3 million tonnes.
Sugar production is also likely to decrease
Sugar production in the European Union is also likely to decline due to bad weather. Prolonged summer heat and drought have adversely affected sugar beet production, forcing Green Pool to revise its production forecast there as well. This estimate has been reduced by 228 thousand tonnes to 12.44 million tonnes. Green Pool believes that these forecasts could be lowered further in the future, which could reduce supply in the European sugar market and affect import demand in the region.
What is the exact situation in India?
Supply shortages are expected in India as the government decided to start early processing of the new sugarcane crop due to limited domestic stocks. However, 300-400 thousand tons of sugar production can be lost if sugarcane is harvested before it is fully ripe. The situation has worsened due to lack of rainfall during the second half of monsoon in the states of Maharashtra and Karnataka.
Reservoir use may be restricted
Water scarcity may restrict the use of reservoir water for agriculture, further threatening future production. International raw sugar futures prices hit a 19-month high (21.29 cents per pound) due to this severe supply shortage. Further changes in prices will depend on actual production and weather conditions in Brazil, India and the European Union (EU).
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