3 February 2021

QCS Market Report January 2021


Raw sugar futures have chopped higher over the past month as the Mar–21 contract achieved life-of-contract highs at 16.75 USc/lb off the back of US dollar weakness.

Fundamental news has remained quiet following India’s export subsidy announcement in December. At least two million tonnes has been contracted for Indonesia, while Indian millers will continue to seek out homes for the remainder of the proposed five million tonnes of exports.

Thailand’s crush is lagging behind the same period last year, as anticipated by the market.

From a fundamental perspective, all eyes will be on the Brazil crop in the coming months.


The Australian dollar has been well supported in the last month by a weakening US dollar, and has seen fresh 33-month highs at USD 0.7816. The ever-increasing numbers of COVID-19 cases and political unrest have weighed heavily on the US dollar and US economy. Investors have moved money from the typical safe havens of the US dollar and gold, towards ‘riskier’ assets such as the US equity market and Australian dollar.

Increases in COVID-19 cases are expected to lead to higher dependence on governments for support. US President-Elect Biden’s fiscal stimulus package, which includes USD 1.9 trillion in economic aid, was passed by both US Houses of Congress, and will be administered as a part of his overall spending package. Post inauguration, the market will watch keenly to see how quickly the new President can enact changes to government spending.