Raw Sugar Futures Climb on ICE Amid Supply Concerns

Raw sugar futures traded on the ICE exchange saw an increase on Thursday, primarily fueled by growing concerns over global supply and crude oil prices trading higher for most of the day. The July raw sugar contract climbed 0.17 cents, or 1.2%, to settle at 14.90 cents per pound, recovering from a 1.9% drop on Wednesday. Market participants highlighted that the European Union, the world's third-largest sugar producer, could experience an 8% to 10% decline in output next season due to reduced planting areas. Concurrently, there are concerns regarding adverse weather conditions in the United States. More broadly, the market fears a potential sugar deficit in the upcoming season, attributed to the El Niño weather phenomenon and the persistent risk of high energy prices. Elevated energy costs could incentivize cane mills to prioritize ethanol production over sugar, further tightening supply. Earlier in the day, crude oil prices had also risen following a Reuters report indicating complications in peace negotiations between the U.S. and Iran, which provided additional upward momentum to the energy complex. In tandem, the most active white sugar contract advanced by 0.9% to reach $445.00 per ton.