• QCS Market Report 17 September 2018 17 September 2018

    Sugar

    • Consecutive weeks of gains were brought to an abrupt end last week, as prices took the elevator down on Friday.
    • Chatter around significantly larger Indian export subsidies saw the prices just shy of 50 points lower after the open.
    • The latest COT report released as expected, with specs reducing their net short position from 188,738 to 163,835 lots.
    • In the face of higher ethanol prices, the Brazilian real continues to weaken as further global trade discussions contain the emerging markets currency.

    Macro/currency commentary

    • It was a quiet start to the week for the AUD, oscillating around USD 0.71.
    • Thursday was the highlight of the local calendar, with the release of better-than-expected unemployment data. As a result, the AUD traded near the week’s high of USD 0.7229.
    • The AUD’s run was stunted on Friday night as the US rounded out the week with a strong non-farm payrolls print, and it closed the week near USD 0.7150.
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  • QCS Market Report 13 September 2018 13 September 2018

    Sugar

    • Sugar producers across the market have enjoyed the recent lift in sugar prices over the past two weeks. After trading at prompt life-of-contract lows, the soon-to-expire October18 contract staged a rally, seeing it above 11 USc/lb.
    • In India, the government is yet to provide an export policy, but in an election year, it seems inevitable it will do all it can to incentivise exports.
    • Friday night’s Commitment of Traders (COT) report stunned many as the specs moved to a record 188,738 lots net short.

    Macro/currency commentary

    • A bumpy ride for the AUD over the past week, oscillating through USD 0.7160–0.7230.
    • The RBA met on Tuesday, leaving rates on hold as expected. The accompanying statement (which was the main focus for most) maintained a neutral stance, without mentioning the highly publicised independent rate increases passed on by local banks
    • The AUD opened higher on Friday, before gains were pared back on firming US data on Friday night.
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