Robust global demand and dryness in India benefits the sugar price

According to the Indian Sugar Mills Association, the lower rainfall in India, the second most important sugar processor worldwide, could also result in sugar production in the key growing area of Maharashtra declining by as much as 7.6% to 9.7 million tons.

If the weather conditions and the resulting smaller crop were to cause the global stocks of sugar to be decreased more sharply, this could lead to higher prices. One reason for the price rise was the appreciation of the currency in Brazil, the world's largest sugar producer. 

Market participants are confident that the demand forecasts for this year could be exceeded. 

"The global sugar market in 2015/16 is already expected to show its first supply deficit in six years", forecasts Commerzbank.