24 April 2021

QCS Market Report April 2021


In mid-April, raw sugar prices jumped more than three percent to record seven-week highs, underpinned by bad weather for crops in Europe as well as Brazil, and positive macroeconomic indicators.

US dollar weakness and inflationary concerns have made commodities attractive for investors, with across-the-board rises led by corn, raw sugar and oil.

Global forecasts for 2021/22 are now for a smaller sugar surplus of around 2.9 million tonnes, primarily due to recent crop downgrades in Brazil.

Analysts note that Brazilian sugar production is likely to fall sharply in the 2021 season, as weather conditions continue to hurt cane growth across Brazil’s centre-south region.

Most analysts were expecting lower Brazilian sugar production in 2021/22, following record production this year, but it is now anticipated that production may drop from 38.5 million tonnes to between 31–33 million tonnes. There remains the possibility of further reductions in forecasts if rainfall does not improve.


The Australian Dollar has continued to trade in a broad USD 0.75–O.78 range, with no signs of moving out of this range in either direction.

US inflation continued to rise with the March Consumer Price Index showing a 0.6% month-on-month and a 2.6% year-on-year change. Although expected, this is likely to revive inflationary fears and could provide a further boost for commodities.

The April meeting of the Reserve Bank of Australia (RBA) provided little news to influence the market. The RBA did however flag that it is prepared to implement further Quantitative Easing measures toward the end of the year if necessary.

Positive US news on the COVID-19 vaccination front boosted risk sentiment, with the US vaccination rollout well ahead of President Biden’s commitment to delivering 100 million vaccine doses in his first 100 days in office.