How is the strengthening El Niño turning an expected global sugar surplus into a possible deficit for the 2026/27 season, what production and export losses are projected in Brazil, India, Thailand and France, and how are tighter inventories, futures prices, speculative buying and

A strengthening El Niño threatens the sugar market on two fronts: it can disrupt cane harvesting in Brazil while reducing rainfall and exportable supply in India and Thailand. A market that began the year expecting a glut is therefore being priced for a possible 2026/27 deficit, though the size of any shortfall remains uncertain. The International Sugar Organization’s initial forecast is a small deficit of 200,000 tonnes, assuming Brazil favors sugar production. 312

• Brazil: Weather threatens Center-South cane performance and milling. One forecast puts sugar output at 42.89 million tonnes, down 2.9%, even as the cane harvest rises; that is a forecast, not a measured El Niño loss or a quantified export cut. 711
• India: El Niño-related dryness puts gross output at an estimated 29–31 million tonnes for the year through September 2027. With cane also being used for ethanol, India may have little sugar available to export; the evidence does not establish a firm 2026/27 export-loss figure. 52
• Thailand: A Thai industry projection puts 2026/27 sugar output more than 17% lower, reducing another major source of export supply. 16
• France: European supply is also under pressure: an estimate cited for the EU as a whole puts 2026/27 production at 13.4 million tonnes, down 19% from 16.6 million. That is not a France-specific estimate. Insufficient evidence supports a precise French production or export-loss figure. 14

The price outlook is consequently two-sided. A deficit would draw down inventories and make further crop losses more consequential; weather fears are already prompting fund buying of futures. But stocks carried over from the preceding surplus, signs of weak physical demand, and the risk that speculative buyers unwind their positions could restrain or reverse a rally. These are competing scenarios, not evidence that a large deficit or sustained price rise is assured. 1210153