Sugar traders are the most bearish in more than four months on speculation India, the world’s second-largest producer, will ship more sweetener this year, expanding a glut accumulated over the past three seasons.
The global sugar surplus will be smaller than previously forecast as millers in Brazil, the world’s largest producer, make more ethanol next year, Kingsman SA said in its fourth estimate for the 2013-14 season.
Raw sugar may drop to 17 cents a pound over the remainder of this year, the lowest level since 2010, as global supply is set to beat demand for a third year, according to broker and researcher Kingsman SA.
The sugar-cane crop in Brazil’s center south, the main growing region of the world’s biggest producer, may climb 60 million to 65 million metric tons in the season that starts there in April, according to Kingsman SA.
The global refined sugar market will stay in deficit this year, with import demand exceeding available exports by 1 million metric tons, even as raw-sugar production expands, said Kingsman SA, a broker and researcher.