ICE Raw Sugar Prices Continue to Fall Despite Oil Price Surge

Raw sugar futures on ICE closed lower on Monday, despite crude oil prices rebounding above $100 per barrel following the failure of US-Iran peace talks over the weekend. The May raw sugar contract fell by 0.5% to 13.68 cents per pound, after initially recovering from Friday's decline. Despite some positive news for sugar, the general expectation is that the market will register a surplus this season, thereby limiting any significant gains. Brazilian ethanol manufacturers stated last Friday that they are prepared to increase production if the government, as planned, raises the ethanol blending mandate to 32% in the first half of the year. However, a tightening of the market is anticipated for the next season, as the El Niño climate phenomenon is expected to develop from mid-year. The government reported that India, the world's second-largest sugar producer, is likely to experience below-average monsoon rains this year due to the development of El Niño. Meanwhile, the most actively traded white sugar contract ended the session down 0.3% at $411.20 per tonne.