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Global Sugar Rally Driven by Fund Bets Not Fundamentals Says Shree Renuka Sugars
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CNBC TV18•12-10-2026, 15:25
Global Sugar Rally Driven by Fund Bets Not Fundamentals Says Shree Renuka Sugars
- •Shree Renuka Sugars Executive Director Ravi Gupta stated that the recent global sugar price surge is fueled by bullish fund bets over El Nino concerns rather than core demand-supply changes.
- •Raw sugar prices have jumped nearly 8 percent in October and around 40 percent from July lows despite weakening consumption in markets like Afghanistan and the Middle East.
- •Global sugar deficit is estimated at 0.5 million to 1 million tonnes this year, with a slight increase expected next year.
- •India's domestic sugar prices are expected to soften in October and November as mills begin early crushing operations and local supply improves.
- •Indian sugar realisations remain below the cost of production, averaging around 39 to 39.50 rupees per kg compared to production costs of at least 41 to 42 rupees per kg.
Key Questions Answered
Shree Renuka Sugars states that the global raw sugar price rally is driven largely by bullish bets from investment funds reacting to El Niño weather concerns rather than actual changes in the fundamental demand-supply balance.
Ravi Gupta from Shree Renuka Sugars expects India to import no more than 300,000 tonnes of sugar during the October-September 2026-27 sugar year, supported by a lower-than-expected import requirement.
The average realisation for sugar mills is expected to be around ₹39-39.50 per kg this year, which remains below the industry's cost of production of at least ₹41-42 per kg.
