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Insight Focus
The US sugar market ended 2025 under pressure. Prices were weighed down by abundant supplies, slow deliveries, and steady imports despite tariffs. Looking ahead, supply remains ample, demand uncertain and no USDA program action is expected.
Plentiful Supplies and Weak Demand Set the Tone
The cash sugar market concluded 2025 in much the same fashion as it began: buyer resistance amid plentiful sugar supplies and an uncertain demand outlook. Some in the trade wondered whether this dynamic represents a new normal for the sugar market, while others felt the tone was simply returning to pre-COVID-19 conditions. Prices were steady in the week ending January 2.
As was the case in 2024, old-crop sugar supplies continued to bloat the market even as new-crop supplies became available. The situation led several sellers to slash prices on 2025 supplies to make room for 2026 sugar.
For many users, however, storage space was not an option, and several users with storage capacity had already maximised inventories with sugar previously contracted and not fully used from the prior year.
The plugged inventories were a symptom of slow deliveries that defined much of 2025. Many in the trade pointed to the increased use of GLP-1 weight-loss drugs as a factor behind shrinking sugar demand. With the advent of a new tablet version of the drugs, GLP-1 use is expected to increase further next year.
Prices Pressured Despite Tariffs and Policy Backdrop
Slow deliveries were one factor behind price pressures in 2025. January spot prices for beet sugar ranged from 45c to 52c/lb, while cane sugar ranged from 50c to 56c/lb. Spot Midwest beet sugar prices dropped as low as 35c/lb during the summer months before regaining ground later in the fall. Still, some sellers continued to offer beet sugar supplies below 40c/lb in recent weeks.
Even tariffs imposed on major suppliers — mainly Brazil — of sugar to the US did not drastically affect prices last year. The gap between No. 11 (international) and No. 16 (domestic) futures prices was often wide enough to absorb high tariff rates on imports and contributed to the continued strong flow of high-tier imports, diverting sugar sales away from domestic suppliers.
The new year may perpetuate many of the factors that weighed on the market in 2025, as demand uncertainty persists and supplies remain abundant.
USDA Sees No Need for Feedstock Flexibility Program Action
The USDA’s Commodity Credit Corp. said it does not expect to purchase or sell any sugar under the Feedstock Flexibility Program for the 2025-26 crop year (October 1, 2025, to September 30, 2026). The program is an option to avoid forfeitures of sugar against loans to beet and cane processors. Under the program, the USDA is required to purchase surplus sugar and sell it to bioenergy producers, but not for food use.
“USDA’s December 9, 2025, World Agricultural Supply and Demand Estimates report projects that crop year 2025 (2025-26) US ending sugar stocks are unlikely to lead to forfeitures,” the USDA said.
Contracting of corn sweeteners for 2026 was complete as 2025 contracts expired at the end of last year.
