Just noticed something interesting happening with sugar prices - that Brazilian real has been on quite a run lately, hitting a 1.75-year high against the dollar. This is actually making Brazilian sugar producers less eager to export, which is causing some short-covering action in the futures market.

March NY sugar closed up slightly on Wednesday while London white sugar dipped a bit, but the overall vibe seems to be shorts getting squeezed. The COT data from a few weeks back showed funds had built up massive short positions in NY sugar, so there's definitely some covering happening.

On the supply side, India just revised their 2025-26 production forecast down to 29.3 MMT (still up 12% year-over-year though), and Brazil's recent output numbers have been pretty weak - Center-South production dropped 36% in late January. That said, cumulative output through January is still slightly positive on the year.

The bigger picture though? Most analysts are still forecasting global sugar surpluses for the next couple of years. Czarnikow expects 3.4 MMT surplus in 2026-27, and even with some variation between different forecasts, the consensus seems pretty bearish on prices long-term. India's also been approved to export more sugar, which is adding to supply pressure.

Brazilian production might be the key watch here - if that keeps sliding, it could support prices despite the surplus outlook.