Raw sugar tests the 18-cent line

ICE Sugar No.11 futures for March 2027, now the front month for raw cane sugar, settled at 18.09 US cents per pound on Tuesday 10 November, down 0.12 cents on the day. During the session, long Liquidation pushed March below 18 cents for the first time since August, to a low of 17.91 cents, before short covering lifted it back above that level by the settlement.

The move followed a quiet Monday, when March settled at 18.21 cents, down 0.03 in a narrow range of 18.18 to 18.44 cents. Market commentary noted that the chart looked vulnerable unless physical buying picked up. That is a technical view, not a forecast, but it shows how close the market is to a level traders treat as important.

Funds are cutting long positions

The clearest pressure on raw sugar is speculative selling. No.11 started the week to 6 November at about 19.1 cents and ended it at about 18.2 cents, with most of the fall on one day. In the week to 3 November, speculators cut their net long position by about 34,700 lots to roughly 146,000 lots. A net long of that size means many funds still hold positive positions, so further selling could keep weighing on prices if sentiment worsens.

Open interest has also been moving out of March into later contracts. On 10 November, the front of the curve was in backwardation, meaning later months traded below the nearby contract. May 2027 settled at 17.55 cents and July 2027 at 17.22 cents. Backwardation often signals that nearby Supply is tighter than later supply. One possible explanation is that the market expects more sugar from the next Brazilian harvest, although that remains a view rather than a confirmed forecast.

Brazil, ethanol and the wider picture

Brazil's centre-south is the largest exporter of raw sugar, so its cane crushing and the share of cane that mills send to sugar instead of ethanol are central to No.11 prices. When ethanol pays better, mills can make less sugar, which tends to support raw sugar. Energy prices therefore matter indirectly, and lower fuel prices have recently weighed on ethanol in the US.

Weather is another risk. Associated British Foods (LSE:ABF) has warned that El Niño could hurt African production in the coming year. If El Niño also affects monsoon rains in Asia, that could change export supply from India and Thailand. For now this remains a scenario to monitor rather than a confirmed driver.

Bunge: sugar is shrinking within a larger business

Bunge Global SA (NYSE:BG) is the main US-listed company with direct exposure to raw sugar, through sugarcane operations in Brazil. In its third-quarter 2026 results, published on 29 October, Bunge said its Grain Merchandising and Milling segment reported a loss before interest and tax of US$74 million. That figure included US$82 million of charges related to the planned sale of two Brazilian sugarcane mills. The company said higher grain merchandising results were more than offset by weaker ocean freight, sugar and wheat milling results.

For Bunge, sugar is now a small and shrinking part of a Business dominated by oilseed processing. Lower raw sugar prices could weigh on the value of its remaining cane Assets and on the mill sale, but the impact on group Earnings is likely to be modest compared with soybean and softseed crushing. Bunge kept its 2026 adjusted earnings-per-share outlook at US$9.25 to US$9.75.

ABF's Illovo: a different route to the same price

ABF (LSE:ABF) is exposed to raw sugar mainly through Illovo, its cane business in southern Africa, which sells into regional and export markets. The Sugar division made a £47 million adjusted operating loss in the year to 12 September 2026, mostly because of lower selling prices in Europe. For the current year, the company guides to a Sugar loss of £70 million to £170 million. It named El Niño's effect on African output and the Malawian kwacha among the swing factors in its annual results.

For Illovo, a weaker No.11 could reduce export income, while drought could cut volumes. Lower output, though, could also tighten regional supply and support local prices. The overall effect on LSE:ABF depends on how these factors combine with currency moves and costs, so a fall in raw sugar should not be read as uniformly negative.

What could lift or weigh on prices

Raw sugar could find support if fund selling slows, if Brazil's mills shift more cane to ethanol, if the Brazilian real firms, or if weather damages crops in Asia or Africa. A wider white premium, which has risen to its highest since mid-September, could also encourage refiners to buy raw sugar.

Prices could fall further if funds keep reducing their roughly 146,000-lot net long, if March closes clearly below 18 cents, or if forecasts for Brazil's next harvest improve. Lower Crude Oil prices could also make ethanol less attractive for mills and push more cane into sugar.

What to watch next

  • UNICA reports. The industry body's fortnightly crushing and production data for the centre-south will be closely watched.
  • CFTC Commitments of Traders. The report is normally released on Fridays, and the US Veterans Day holiday on 11 November may affect this week's timing.
  • Contract roll. Any rolling of positions out of March 2027 could add volatility.
  • Company and industry updates. Watch any International Sugar Organization revision to its global balance, Bunge's progress on its planned mill sale and the next trading update from LSE:ABF.