Morning Call Jul 01st, 2026

NY raw sugar market maintained its recovery trend, with July 2026 rising 5 points to US$ 14.34 c/lb, while October 2026 gained 4 points to US$ 14.82 c/lb, narrowing the Jul/Oct carry spread to 48 points.
 

NY #11: despite support from the combination of weather-related risks, the perception of a large surplus in the global sugar Trade Flow continues to limit a more sustained price recovery in the short term.
 

NY #11: according to preliminary data, physical delivery against July 2026 contract totaled 15,678 lots, or approximately 796 k mt. COFCO was the sole deliverer, with all sugar originating from Center-South Brazil.
 

CS Brazil: an atmospheric blocking pattern is expected to restrict the advance of rainfall into the main cane-producing regions, favoring a return to dry weather conditions and higher temperatures in the coming days.
 

CS Brazil: the improvement in weather conditions should allow the resumption of harvesting and crushing operations, following a June marked by above-normal rainfall for the dry season.
 

CS Brazil: according to DATAGRO, rainfall resulted in an average of 8.0 lost crushing days in June, compared to the historical average of just 1.6 days. Weather models indicate the return of rainfall from the second week of July onward.
 

Argentina: ethanol production reached a record 102 million liters in May (+2.0% YoY), bringing the January-May total to 479 million liters (+1.3% YoY), also a record for the period.
 

Brazil: the gasoline-to-ethanol substitution rate reached 47.2% in May, the highest level for the month since 2019, with Mato Grosso, São Paulo, and Goiás recording rates above 50%.
 

Brazil: the government ended the R$ 0.35/liter diesel subsidy and is considering discontinuing incentives for imported diesel and gasoline, amid expectations of normalization in the international oil market.
 

Indonesia: the government allocated Rp 14 trillion (US$ 780 million) for irrigation system revitalization in 2026, as part of its strategy to expand self-sufficiency in sugar, rice, and corn.
 

Russia: sugar production totaled 31 k mt in May (-40.3% YoY), bringing cumulative output in the 25/26 crop to 6.351 mmt, virtually unchanged compared to the previous year (+0.1% YoY).