White sugar prices have risen to their highest levels since October. This surge is driven by increasing oil costs. Ongoing disruptions in the Strait of Hormuz are also a factor. These issues have raised concerns about supplies in the Middle East. Shipments coming from the region are also affected.
The most traded contract in London climbed 2.7%. It reached $449.4 per ton. This is its highest level since October 15. Raw sugar also rose over 3% in New York. This mirrors crude oil movements. Some ships bound for Middle Eastern refining centers are delayed or rerouted. This limits refined sugar production. Regional demand remains high.
Gulf sugar refineries typically rely on stable raw sugar flows. These come from Brazil and other sources. Delays and rerouted vessels are creating supply gaps. These gaps affect the Middle East, East Africa, and parts of Asia.
Raw sugar futures jumped to a more than two-month high. This aligns with oil prices. The market is monitoring Brazil’s national oil company, Petrobras. Petrobras is addressing rising energy costs.
Any local gasoline price hike would encourage sugar mills. They might divert more sugarcane to ethanol production. This would reduce global sweetener supplies.
India’s flows are restricted due to lower output and weak exports. The market increasingly depends on Brazil’s production mix. The allocation between sugar and ethanol will be crucial. It will determine global supplies in the coming months.