Raw sugar futures in the US surged above $22.4 per pound in early April, the most in over six years, supported by expectations of higher biofuel demand and lower output from key producers, data from Trading Economic has indicated.
Crude oil prices soared after OPEC+ announced a surprise output cut, encouraging sugarcane producers to allocate crops to more profitable biofuel blending instead of sugar crushing and limiting the sweetener supply as a result.
To add, Brazil’s new federal government ended its tax exemption program for gasoline, raising demand for lower-taxed sugarcane ethanol and adding to the momentum for biofuel blending.
In Nigeria, price of sugar is likely to rise as the major country’s producers and refiners, Dangote and BUA, still depend on raw sugar importation to keep the factories working.
Reports by the National Bureau of Statistics (NBS) disclosed that raw sugar to the tune of N410.6 billion was imported to Nigeria in one calendar cycle from the second quarter of 2021 to the first quarter of 2022.
