Was World Sugar’s Price Weak Considering the Action in Crude Oil?

I asked if higher oil prices sent world sugar futures higher in an April 9, 2026, Barchart article, where I concluded with the following:

Due to their connection to ethanol, world sugar futures and the CANE ETF should continue to track volatile oil prices over the coming days and weeks. However, commodity cyclicality suggested that prices had declined to a level where production was no longer economically viable, inventories began to decline, and consumption increased, leading to a price bottom at 13.34 cents per pound. I remain bullish on the prospects for world sugar futures in early April, but would only add to long positions on price weakness.  

Nearby ICE world sugar futures were trading at 14.40 cents per pound on April 8, 2026, while the CANE ETF was trading at $9.74 per share. Meanwhile, NYMEX WTI crude oil prices were $94.12 per barrel, with Chicago ethanol swaps at $1.9850 per gallon wholesale. 

In late May, sugar futures and CANE were slightly higher, crude oil prices were lower at around $91 per barrel, and ethanol swaps were higher at $2.0350 per gallon wholesale, providing a confusing picture for the path of least resistance of world sugar futures prices. 

 Crude oil/gasoline and ethanol prices diverge 

On May 25, the active month July crude oil futures were lower than on April 8.

The chart shows that nearby July NYMEX crude oil futures were trading under $91 per barrel. Gasoline futures moved higher on seasonality as the 2026 driving season is underway.

The daily continuous NYME gasoline futures chart shows that the price has increased from around $3 per gallon to over $3.20 per gallon at the wholesale level. 

While crude oil was lower and gasoline was higher since April 8, ethanol prices have increased. Chicago ethanol swap prices have outperformed oil and underperformed gasoline futures on a percentage basis. 

Sugar futures and the CANE ETF have moved higher since April 8

The year-to-date chart of ICE world sugar futures shows that the sweet commodity has traded in a 13.34-16.10 cents range in 2026.  

After trading around 14.40 cents per pound on April 8, sugar futures moved higher to 14.70 cents per pound on May 22. 

The Teucrium Sugar ETF, which tracks three ICE sugar futures contracts excluding the nearby contract to minimize roll risk, has edged higher from $9.74 on April 8 to $9.90 on May 22. 

The Teucrium Sugar ETF, which tracks three ICE sugar futures contracts excluding the nearby contract to minimize roll risk, has edged higher from $9.74 on April 8 to $9.90 on May 22. 

An explosive move in oil could ignite a rally in sugar futures 

As highlighted in the April 9 Barchart article, Brazil is the world’s leading free-market sugar producer, and second-leading ethanol producer. While the U.S. processes corn into biofuel, Brazil processes sugarcane. Therefore, sugar prices are sensitive to crude oil, gasoline, and ethanol prices. 

The ongoing hostilities in the Middle East and closure of the Strait of Hormuz have caused oil, gasoline, and ethanol prices to rise. While prices have stabilized, an escalation in the region that pushes energy prices even higher could ignite a substantial rally in ICE sugar futures. However, if oil prices begin to decline substantially, world sugar futures could drop to the bottom end of the 2026 trading range. 

Levels to watch in sugar

ICE sugar futures have been in a bearish trend since November 2023, when the nearby futures contract reached a high of 28.14 cents per pound. 

The monthly chart shows that ICE world sugar futures #11 have made lower highs and lower lows since November 2023, reaching a low of 13.34 cents per pound in February 2026. In April, the sugar futures reached a slightly higher low of 13.39 cents before recovering. 

Technical support is at 13.34 cents, with the first resistance level at the March 2026 high of 16.10 cents per pound. While sugar prices have tracked oil, gasoline, and ethanol prices, they have not risen as much.

If the situation in the Middle East continues to escalate over the coming weeks and months, sugar could begin to catch up with energy prices as Brazil uses more sugarcane for ethanol production, reducing exports and impacting sugar’s supply-demand equation. However, if oil and gasoline prices decline, world sugar futures are likely to remain within the recent trading range.

The long-term chart suggests that risk-reward dynamics favor the upside

While the short-term support and resistance levels for ICE sugar futures are 13.34 and 16.10 cents, respectively, since November 2023, the low and high prices have been 13.34 and 28.14 cents. Therefore, the long-term chart suggests that risk-reward in the world sugar futures market favors the upside. A long position at 14.70 cents has roughly 1.40 cents of downside risk and over 13.4 cents upside potential, translating to a better-than-1:9.5 risk-reward ratio. 

Moreover, the 13.34 low was the lowest sugar price since October 2020, when the global pandemic sent markets across all asset classes to multi-year lows. Elevated global inflation has increased production costs for all raw materials, putting upward pressure on prices. 

Sugar is a soft commodity. In 2024 and 2025, cocoa, Arabica coffee, and frozen concentrated orange juice futures rose to all-time highs. Higher production costs, weather events, crop diseases, geopolitical factors, and other factors pushed cocoa, coffee, and FCOJ to record highs. 

Commodity cyclicality suggests that prices fall to levels where production declines, inventories drop, and consumption increases, leading to price bottoms. Time will tell if sugar reached a cyclical low at 13.34 cents.

The risk-reward dynamics for a long world sugar futures position are attractive at 14.70 cents per pound. I continue to support buying sugar on price weakness, leaving room to add on weakness to the 13-cent support level to accumulate a long position.