Déjà vu all over again: Global sugar markets roiled by El Niño, biofuels and trade policies

As with other commodity markets such as rice, the global sugar market has seen large increases in prices due to El Niño-related production shortfalls in major exporting countries in South and Southeast Asia. At the same time, other factors are also constricting supplies. Port bottlenecks have tied up exports in Brazil, the world’s largest sugar exporter, despite a large increase in production over last year’s levels. Domestic biofuel policies in key exporting countries are diverting sugar production to biofuel production and thus limiting exports. rice markets, export restrictions—here, in India and Thailand—have exacerbated these shortages as well.