Sweet Life: why sugar prices have dropped

From January to October 2025, sugar prices fell by a quarter and returned to the values of the end of 2020. According to Datagro, a Brazilian consulting firm, sugar overproduction of 1.98 million tons is expected instead of the projected deficit of 5 million tons. Izvestia found out how long the price drop will continue and how it will affect the cost of sugar and confectionery in Russia.

Not only Brazil

The fall in world sugar prices is a natural reaction of the market to the record supply, says Anatoly Tikhonov, PhD in Economics, Director of the Center for International Agribusiness and Food Security at the Higher School of Economics of the Presidential Academy.

— Brazil, the largest producer, has harvested a historic sugar cane crop this season — more than 620 million tons, which allowed for the production of about 42.5 million tons of sugar. After several years when supply lagged behind demand, the market received an excess of products, and quotations on the ICE NY stock exchange collapsed. This is a classic example of a cyclical correction after a period of high prices," he says.

The expert stressed that this is not a structural decline, but a temporary effect associated with good weather conditions, increased yields and the decision of producers to increase the share of sugar by reducing ethanol production. According to the FAO, global demand continues to grow by about 1.5–2% per year and will exceed 185 million tons in 2025.

According to estimates by the consulting company Datagro, in the 2025-26 season, sugar production in Brazil will grow by 3.1% to 41.42 million tons compared to the previous season. Next season, analysts predict an increase in sugar production to 43.2 million tons.

There is a surplus in the market due to the high projected production volumes. And not only in Brazil, but also in India and Thailand, says Denis Ternovsky, an expert at the Economic Policy Foundation.

— Among other things, the market is being pressured by a decrease in ethanol production from sugar cane in Brazil. Consequently, the increase in its processing into sugar is up to 52.1% compared to the previous 48.1%. The reason is that ethanol from cane is being actively replaced by cheaper ethanol from corn, the production of which will increase by 20%," he explains.

Russia's dependence on world prices

The global sugar price environment has traditionally had a weak impact on Russia, the experts surveyed noted. At the same time, world prices are partially reflected in domestic prices through exports, Denis Ternovsky says.

"Russian prices are falling following global prices, but this is primarily due to the strengthening of the ruble this year," he believes.

Will sugar rise in price in Russia

According to Evgenia Trautman, an expert at the ACRA group of sovereign and regional ratings, a noticeable downward trend in sugar prices has been observed since mid-2024. "The cost decreased by 1% in September 2025 compared to September 2024," she says.

According to Anatoly Tikhonov, the domestic market is largely provided by its own beet sugar production, and prices depend primarily on the sugar beet harvest, cost and logistics.

— Government regulation and stable stocks do not allow stock market fluctuations to directly affect consumer prices. But the decline in global quotations has a restraining effect on the growth of wholesale prices in the country," he argues.

Izvestia's interlocutor estimated the shifting sugar reserves in Russia at more than 3 million tons, and the total sugar supply in the 2025-26 season will exceed 10 million tons with domestic consumption of about 6.5 million.

— Technically, this is a surplus, — says Tikhonov, — but it carries potential risks. For example, unaccounted-for "gray" exports, which may deplete stocks by the spring of 2026, as well as cost increases, reducing the profitability of manufacturers. If costs continue to rise and export controls remain weak, a short-term spike in prices is possible by spring. Therefore, in a period of excess, it is important to take preventive measures, from transparent inventory statistics to flexible export duties, so that the current balance does not turn into a crisis.

Sweetness to joy

Sugar-containing confectionery products have increased in price by about 55% over the past 5 years.

The dynamics of cocoa prices, among other things, have a noticeable effect on the change in prices for confectionery products, says Evgenia Trautman. Cocoa has increased in price by almost 58% over the same period.

— When viewed in more detail, the price increase for products that clearly contain cocoa (soft candies glazed with chocolate, chocolate, natural chocolate candies and with additives) was more significant (by an average of 53%) than for products that do not contain cocoa (caramel, marshmallows, marshmallows, jam, jam, jam). The growth for these product groups averaged 44%," the analyst shared.

— All the costs of sugar, both in its pure form and in the composition of other products, on average per person per year can be estimated at about 3,000 rubles, — Denis Ternovsky estimated. — Therefore, fluctuations in sugar prices will not have a significant impact on consumer spending.

He noted that the opposite effect is most likely in the form of rising prices for confectionery products due to other price components: the cost of cocoa, increased costs for equipment and its maintenance, transportation, packaging, energy, etc.

Is it even necessary?

Sugar is dangerous because it is contained in a hidden form in a huge number of products that we encounter: from various sauces to confectionery, bakery products and even low-fat yoghurts, recalls Kirill Masliev, Candidate of Medical Sciences, member of the State Council Commission "Long and Active Life", head of the Department of Preventive Medicine at the Rudn University.

"The constant consumption of sugar in a hidden form disrupts many metabolic processes in our body, leading not only to the risk of type II diabetes, but also to a variety of chronic diseases, including cancer," warns the Izvestia respondent.

Izvestia sent inquiries about sugar and the rise in world prices to the Ministry of Economic Development and the Ministry of Agriculture, but received no responses at the time of publication.