Morning Call May 18th, 2026

NY raw sugar market posted a week marked by volatility and partial price recovery, initially supported by gains in the energy sector and the strong ethanol-oriented mix in CS Brazil, with the move further reinforced by India’s ban on sugar exports through September 30th.
 

NY #11: the advance in prices stimulated a new round of hedge fixations and profit-taking by producers, which coupled with Brazil´s government intention to subsidize gasoline pressured the market in recent sessions. July 2026 fell 19 points on Friday, to US$ 14.80 c/lb, although still accumulating gain of 11 points over the week.
 

U.S. dollar advanced 1.7% last Friday to R$ 5.0654/US$ PTAX, accumulating gains of 3.4% over the week, increasing selling interest and contributing to pressure on sugar prices.
 

CFTC: funds and small specs increased slightly their net short position in the NY raw sugar market from 87,289 lots on May 5th, to 92,990 lots on May 12th.
 

CS Brazil: in the ethanol market, negotiations remain slow, with producers reducing market activity amid a sharp decline in prices, while demand continues to press for lower values as the crop progresses.
 

CS Brazil: last Friday, in São Paulo, hydrous ethanol prices for producers reached R$ 2.2272/liter, down 2.1% WoW, while anhydrous ethanol traded at R$ 2.5878/liter, down 0.2% WoW, both ex-mill and net of taxes.
 

CS Brazil: in Paulínia (SP), the CIF price for hydrous ethanol reached R$ 2.3248/liter, net of taxes, down 1.7% on the week, according to DATAGRO Price Reporting Agency (PRA).
 

El Niño: NOAA increased from 25% to 37% the probability of the phenomenon reaching intensity above 2.0°C between November 2026 and January 2027, which would characterize a strong El Niño event.
 

El Niño: according to NOAA, conditions remain favorable for the intensification of the phenomenon, with persistent westerly winds in the Pacific and continued positive subsurface temperature anomalies.
 

El Niño: despite the increase in climate-related risks, NOAA highlighted that uncertainty regarding the event’s peak intensity remains elevated and that strong episodes do not necessarily guarantee severe impacts.
 

CS Brazil: weather forecasts indicate a high probability of a wetter winter in 2026, in line with the El Niño formation process in the Pacific.
 

CS Brazil: a wetter scenario during the dry season could disrupt cane harvesting and transportation operations, in addition to affecting cane quality throughout the 26/27 crop year.