Czarnikow, whose caution last month that sugar demand was higher than had been appreciated fuelled a price rally, has hinted that values may still not be high enough, citing the sweetener's soaring production costs.
Czarnikow acknowledged that the market could, "in the short run", keep prices at levels which offer no profit to producers,
But this dynamic, in offering no incentive to producers, "fails in the medium-to-longer term".
"Our view is that the market has moved beyond the short-run," the London-based merchant said, implying upward pressure on prices which, at current levels, were leaving "the world market's leading sugar producers reporting losses".
"The rising levels of debt and insolvency all highlight the damage that low prices have done."
'Dire financial straits'
In Brazil, the top sugar-producing country, Czarnikow estimated that sugar prices needed to reach 22-23 cents a pound to lift returns comfortably above an estimated risk-free rate of 10%, and encourage investment.
Separately, Macquarie highlighted the hardship facing Brazilian mills, of which some 40 had closed in the past three years in the key Centre South district, and with another 60 are forecast to follow within the next two years under pressure from "unmanageable" debts.
"Of the 385 plants still working, a significant proportion are in dire financial straits and many may have to close down at the end of this season," the bank said.
"We fear that at this year's average price of 17 cents a pound, no financing is becoming available for new mill start-ups."
In India, "the problems facing the cane industry are even more profound that those in Brazil", with mills' operating costs above sugar prices, Czarnikow said.
"Sick mills now account for more than one-third of the 516 mills in the sector," the merchant said, noting that 172 mills are closed "given current poor earnings".
The Indian Sugar Mills Association estimates that the industry's net loss this year will top 30bn rupees ($460m).
Cane costs have "doubled" in China and Thailand over the past five years, to beat production costs and provide the remuneration required "to prevent the destruction of rural communities", Czarnikow said.
Thailand's cane costs of 1,179 baht per tonne equate too to a futures price of about 22-23 cents a pound.
The comments came as New York's benchmark March contract recovered from early losses to stand 0.1% higher at 19.44 cents a pound in lunchtime deals.
Prices stood at some 16.50 cents a pound when Czarnikow published its previous report, in early September, which sparked a sector-wide debate over consumption levels.
The market has been underpinned by a slowdown in the Centre South cane harvest, thanks to rains, as highlighted by Unica data overnight, and by a fire at the Brazilian port of Santos which has taken significant export capacity offline.