Sugar prices, while setting a 30-year high of 36.08 cents a pound in New York in March, failed to hang on to gains.

New York raw sugar ended the year down 27%, making it amongst the agricultural commodity complex's worst performers. London white sugar did slightly less badly, dropping 23%.

Still, some commentators had expected even steeper declines, with the prospect of a return to surplus, helped by stronger European, Indian and Russian output.

This was in part offset by disappointing Brazilian production and, to a lesser extent, by fears for the impact of floods on exports from Thailand.

Commerzbank

"We expect a stabilisation [in sugar prices], provided no more negative macroeconomic factors come into play. The news about high global production volume and estimated supply surpluses in the region of 4m tonnes to more than 8m tonnes… for 2011-12 should be priced in.

"At the moment plantations are being renewed, but it is doubtful how beneficial this will be in the next harvest already. So far estimates for the next harvest in [Brazil's] Centre-South are for around 500m-530m tonnes.

"These shortfalls are being offset by production increases elsewhere. In Thailand, the floods do not seem to have caused any major damage to sugar cane plantations. Bumper harvests in Russia and the EU could also have a price dampening effect in 2012.

"Given the sharp rise in production costs in Brazil over the last decade and the alternative use of sugar cane in ethanol production, prices should be well supported."

Goldman Sachs

"In Thailand… concerns for supply losses following the floods have eased, and sugar output expected to set a new record.

"Net, we expect this supply response to continue to weigh on prices.

"We don't expect a larger decline in prices for now, given expectations by Unica [the Brazilian cane industry group] for limited production growth in Brazil for the upcoming 2012-13 season, given recent adverse conditions as well as competition from ethanol at those lower prices."

Morgan Stanley

"Sugar fundamentals should soften in the first half of 2012.

"An aging cane profile will continue to drag on agricultural [cane] yields.

"Northern hemisphere harvests [are] expected to more-than-offset Brazilian shortfalls. The European Union and Russia will both need less imported sugar in 2011-12.

"China and Malaysia [are] still bullish risks in 2012. Though we see Chinese production growing by 1,1m tonnes, or 9%, year on year on better weather in the south of the country, it is still unlikely to fully satisfy the country's growing demand.

"The Malaysian government has been looking to procure sugar supplies for its next three years of consumption."

Rabobank

"We forecast lower international sugar prices in 2012 as the market shifts into a surplus for the first time in three seasons.

"A number of supportive factors will prevent the collapse of values. Increased demand from global importers and the ethanol industry in Brazil are anticipated to be major supportive factors.

"Also, the forecast surplus will not be enough to replenish the 19.8m-tonnes of deficit of the past three seasons, and while the stocks-to-use ratio is expected to increase in 2011-12, it is forecast to be five percentage points below the 10-year average."

Societe Generale

"Going forward, assuming modest historical growth in domestic consumption, Brazil should be able to resume its strong export programme, barring any surprises in production next year.

"If prices remain reasonably high, significant encouragement for investments in fields will occur, particularly in aging fields.

"We see global stocks-to-use looser in 2011-12 year on year and largely unchanged year on year into 2012-13, even as the surplus is expected to trend lower.

"A key risk in our long-term prices will be an unexpected deficit in the coming months. If India delays or reduces expected forecasts or Thailand production is less than expected and/or delays or cancels exports, we will certainly see prices remaining supported, if not higher."

Standard Chartered

"We remain sugar bulls. Within the softs complex, we expect sugar to outperform, despite the possibility of a surplus in the market.

"Costs in Brazil's sugar industry are close to 22 cents a pound, which is close to current market prices. Furthermore, Brazil's output is likely to slow considerably in the current season because of ageing cane and poor weather.

"We expect the sugar trade to be slower in 2012, not because of falling demand, but because surpluses will have to be incentivised by higher prices before delivery."