Sugar Just Round-Tripped 3 Years… and Oil Is Starting to Matter

Oil, ethanol, and a failed breakdown at $13 are starting to matter more than the surplus story

I’ve been spending time on sugar lately, and the starting point for me wasn’t anything on the lower timeframes. It was the bigger picture.

When you look at the continuous contract, the first thing that stands out is how complete this move has been. From the COVID lows into the 2023 highs, and then the entire unwind right back into that same base.

It’s not a pullback.
It’s a full round trip back to where the move originally started.

Let me explain…

In 2020, sugar came out of a multi-year base and began a move that lasted more than three years, running from roughly $10.50 in April 2020 to just under $28 by late 2023.

That move was driven by a tightening global balance. Brazil shifted cane toward ethanol at different points, weather disrupted supply across key regions, and demand held steady. The market moved into deficit and price followed.

By the time we got into 2023, most of that had already played out.

Then the dynamic flipped. Brazil produced. Hard.

Favorable weather and strong margins pushed output higher. Exports picked up. India stabilized production. The market moved back into surplus, and over the next two years sugar repriced that shift in a very orderly way… lower highs, lower lows, and rallies that didn’t hold.

By early 2026, sugar was back below $15. At that point, the bearish story wasn’t developing anymore. It was already known… and already priced.

That’s where I start paying attention.