The International Sugar Organization (ISO) has issued a stark warning about future sugar market conditions, projecting a 262,000-tonne global deficit for the 2026-27 season amid El Niño concerns. According to the ISO's third revised outlook for the 2025-26 season, the organization estimates global sugar production at a record 182 million tonnes, up sharply from 175.9 million tonnes a year ago. Despite this record production, the body flagged concerns about weather-related disruptions that could impact key producing countries and push the market into deficit territory. The ISO warns that El Niño-linked weather risks could disrupt rainfall patterns in key producing countries, creating the projected deficit despite the current season's surplus. Latest market data shows sugar prices fell to 1-week lows on Monday, with July NY world sugar #11 closing down -0.07 (-0.47%) and August London ICE white sugar #5 closing down -2.00 (-0.46%).
For the 2025-26 season, the ISO projects a marginal surplus of 2.2 million tonnes, reversing the previous season's deficit of 3.2 million tonnes. Global demand is estimated at 179.8 million tonnes compared with 179.1 million tonnes last year, while production is expected to reach the record 182 million tonnes. The organization also projected lower export availability at 64.2 million tonnes in 2025-26 against 64.8 million tonnes a year ago, with imports expected to decline to 63.3 million tonnes from 65.1 million tonnes. End-season stocks are pegged at 79.4 million tonnes, marginally higher than 78.9 million tonnes last year. The ISO has now raised its 2025-26 global sugar surplus estimate to 2.2 million tonnes from a February forecast of 1.22 million tonnes, rebounding from a -3.46 million tonne deficit in 2024-25.
The global outlook comes days after India prohibited sugar exports until September 2026 to contain domestic prices and ensure adequate local supplies. As reported by Essential Business Intelligence, India, the world's second-largest sugar producer after Brazil, had earlier permitted limited exports of 1.59 million tonnes, anticipating surplus output. However, lower cane yields and concerns over monsoon disruptions prompted the policy reversal, with the export curb already pushing global sugar prices higher and both raw and white sugar futures gaining after the announcement. The export curb has created additional pressure on global supply chains, contributing to the projected deficit for the following season. The ISO's 2026-27 forecast projects 2026-27 global sugar production of 180 MMT, down 1.1% year-on-year, with the deficit primarily attributed to potential El Niño impact on harvests in India and Thailand.
