Last week’s Commitment of Traders (COT) report surprised somewhat, with non-index specs showing a net short 126,000 lots, slightly more than anticipated.
Despite the positive backdrop for prices, led by non-index specs, the rest of the week has seen the market erode much of those prior gains.
Softening physicals and white premiums have pushed more producer pricing into raws.
Macro/currency commentary
Local unemployment data gave the AUD a leg up to fresh one-month highs at USD 0.7168, but gains were short lived as the USD clawed back losses on the back of some second-tier jobs data.
As the week draws to a close, the AUD looks set to close on a 71-cent handle.
The AUD continues to gravitate around USD 0.71, despite positive local employment numbers.
Raw sugar futures continued to slump as the new prompt May19 contract finished the week down 5.1%.
The Indian Government raised the domestic price of sugar just over a week ago, as the mills’ cries for assistance seem to have been answered. Cane farmers arrears continued to grow, prompting further assistance from the government.
It is yet to be seen whether the subsidies will continue to encourage farmers to grow cane, despite the uncertainty of payments.
Macro/currency commentary
The AUD struggled to slow USD momentum over the back of last week, closing the week below USD 0.71.
Newswires were highlighted by US President Trump extending the tariff deadline with China, whilst reports out of the UK suggested Prime Minister Theresa May was planning to delay Brexit to delay a no-deal scenario.
A quiet start to the current week as the AUD was back above USD 0.71. Comments from US President Trump, suggesting the USD is too high, helped the AUD start on a positive note.
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