Insight Focus
Sugar prices are at the lowest of the past 5 years. How will the main producing regions fare in this environment?
We look at a sample that represents over 60% of world sugar production. 2026 is a challenging environment for most of sugar producers – so far, raw sugar futures have averaged 14.5c/lb this year. This is 7% lower than the cost of production of the cheapest origin.
India: USD 430/tonne for White Sugar
White sugar production costs in Maharashtra (India’s main exporting region) are ~USD 430/tonne for white sugar after we account for revenues from electricity generation and ethanol. These revenues equate to around USD 50/tonne of sugar and help to reduce the break-even point for those mills that benefit from them.
If India was to export raw sugar, mills in Maharashtra would incur a cost of ~19 c/lb.
The USD value of cost has come down following a 7% depreciation of the Indian Rupee since the season start of this year’s crush. This has countered the annual increase in the government-set Fair and Remunerative Price (FRP) that mills must pay farmers for their sugarcane.
EU + UK: Over USD 625-675/tonne for Refined Sugar, ex-works
In 2025/26, the most competitive producers in Europe (UK, Germany, France, Poland, Netherlands) had break-even ex-works prices in the range of USD600-630/tonne (EUR 500-550/tonne), once you include revenues from by-products such as beet pulp and molasses. Production costs fell compared to last year in USD terms by an average of ~10% largely due to lower beet prices paid to farmers. Costs also benefited from lower gas prices. However, a stronger Euro and British Pound mean USD costs fell less than in local currency.
However, gas prices have increased sharply since March following the conflict in the Persian Gulf. European gas futures for contracts during the beet slicing campaign indicate that factory energy costs could increase by ~ 30%. We also expect fixed costs to increase per tonne of sugar as reduced beet plantings have a knock-on impact on factory throughput. Although some producers may reduce beet prices further, our latest estimates indicate break-even prices in 2026/27 will increase by around 5-10% year-on-year to USD 625-675/tonne.
Thailand: USD 360/tonne for Raws, USD 460/tonne for Refined
In the 2025/26 season, Thailand’s raw sugar cost of production is estimated at USD 360/tonne (16.27 c/lb – FOB basis) and refined sugar at USD 459/tonne. COP levels are significantly lower than last season due to the government’s lower provisional cane price of THB 890/tonne, down 23.5% year-on-year from THB 1160/tonne. Sugar yields held steady at 10.8%, close to the average of 11%.
Brazil: USD 345/tonne for Raw Sugar (FOB)
In 2025/26 season, we estimate that raw cane sugar cost of production was around USD 345/tonne (15.7 c/lb) – FOB basis. This new 2026/27 season presents new challenges. The Iran Conflict means that diesel prices are 22% higher than last year and fertilizer prices are up 30%. This will have impacts for cost of production this season.
As a comparison, cost of production went up by 12% in 2022/23 season – the year of the Russia-Ukraine War.
China: USD 780/tonne for Cane Crystal Sugar
The government has kept sugarcane prices at a high level of RMB520 (USD76.5)/mt ex field. This was done to maintain cane profitable to farmers and incentivize an increase in planting – which is still a reality for the upcoming 2026/27 crop – and reach government’s guidance of sugar self-supply rate at 70%.
Despite high cane price, improvements in ag yields have aided in reducing cost of production in China. As an example, Guangxi had an average agricultural yield of 60tc/ha and sugar yield of 12%. In 2025/26 ag. yield increased 23% to 74tc/ha and sugar yield to 12.8%.
Australia: USD 450/tonne for Raw Sugar
Australian producers have struggled with lower ag. and sugar yields (due to extensive flowering, which reduces sucrose content). Additionally, higher diesel prices and strength in AUD have increased sugar cost of production.
