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Weekly Market Report 2 June 2015 2 June 2015
SUGAR UPDATE July Sugar made life-of-contract lows (just) at the end last week falling below 12c, although has failed to stay under that level, rallying back to 12.30 on Monday night. At the end of trading last week the Commitment of Traders (CoT) report was released showing the specs had turned from a small long position into a medium-sized short in the space of a week. Lower volumes and lack of producer interest suggests this group of investors was the majority of the selling last week. It is hard to see signifi...Read full article -
Weekly Market Report 24 June 2015 24 June 2015
SUGAR UPDATE Sugar remains in a state of flux, waiting for a clarity over a number of factors which can only be resolved through time. Producers are continuing to sit at and above the market in the hope of better prices to lock in, commercial buyers are sitting at or below the market, bringing forward demand to capture lower prices. The current swing factor has been the spec position, which has turned a small long at 13.60 into a large short position in the low 11c. Following the release of the Commitment of Trade...Read full article -
Weekly Market Report 8 July 2015 8 July 2015
SUGAR UPDATE Sugar continues to trade at the lower end of the longer term recent ranges, although a technical squeeze off contract lows has followed a one-year severe downtrend. The market is trying become more bullish, arguing large rainfall in Brazil will hamper harvesting and drought in Thailand will hamper additional cane acreage. Volumes have been low for the last couple of weeks with producers standing aside waiting for better levels given the length of time to the October expiry and buyers not being in ...Read full article -
Weekly Market Report 6 November 2015 6 November 2015
SUGAR UPDATE The dynamics of the sugar market have done a complete about face since the end of September. The market is up seven weeks in a row, with spot prices now sitting mid 15 cents. Whilst the macro background has certainly become more positive, most recent price action is more indicative of traders’ positions being squeezed out rather than a belief that we are back on the way to 20c. The bullish arguments are, rain in Brazil will interrupt the harvest, Chinese, Thai and Indian production will all be lo...Read full article -
Weekly Market Report 17 November 2015 17 November 2015
SUGAR UPDATE The sugar market seems (once again) to be trapped in a range. This time however the range is significantly higher than the lows and there are reasons to suggest we may continue to move higher. The new range is 13.70 to 15.50 with end users seen buying before 14c and producers selling over 15.25. Like most other times there are competing forces. On the bullish side, rain is threatening to hamper what remains of the Brazilian crop. Sugar production seems set to end around 30.5mmt down from earlier es ma...Read full article -
Weekly Market Report 1 December 2015 1 December 2015
SUGAR UPDATE The sugar market spent the month of November trapped sideways significantly off the September lows. The market is grappling with opposing forces as spoken of previously (dryness in many production areas and too much rainfall in Brazil against an Indian subsidy which may release 2–2.5mmt (but up to 3.2mmt) on the world export market, plugging most of the perceived production deficit for next year. Technically the fact the market has been unable to sell off through 14c bodes well for an eventual ...Read full article -
Weekly Market Report 26 February 2016 26 February 2016
SUGAR UPDATE The action of the fund/speculative community has been the key driver of the sugar market at different times, and has been the especially the case recently. The large push from the Sept lows to Dec highs was a reversal of a large short position into a large long position. A deteriorating macro environment (oil under pressure, China worries, Japan going to negative rates) halted the push higher and left these longs vulnerable. The sell off through Jan ended with the specs being close to zero, although...Read full article -
Weekly Market Report 14 March 2016 14 March 2016
SUGAR UPDATE On light volumes sugar has pushed back towards the top of the range. In a macro sense very little seems to have changed to be driving this move higher. The net spec position has pushed long an additional 50k for the week and now stands at +100k. On the positive side, USD/BRL has fallen away to 3.58 with BRL shorts being covered into the potential for the impeachment of the President. There was some market talk around suggesting 75% of the upcoming crop has already been priced, taking away some of the ...Read full article -
Weekly Market Report 5 April 2016 5 April 2016
SUGAR UPDATE The speculative and fund community caught the market by surprise over the weekend, with what was expected to be a reduction in their long position (into the 68 point fall last Tuesday) actually was an increase. It now appears more and more likely this is where the majority of the move up from 12.50 has come from. So where to now? Prices have washed out from 16.77 to 14.62 in the space of a week. But the long position of this sector is still very large by historical standards. Could they go to all the ...Read full article -
Weekly Market Report 12 April 2016 12 April 2016
SUGAR UPDATE The sugar market is currently the subject to two very different influences that are both fighting for overall control. On one hand, global commodities are rallying due to optimism in Chinese policy and the belief that the Fed will maintain interest rates at a low enough level to allow growth whilst having the cost of money virtually free. This has led to a “risk asset” rally—equity markets, commodities and commodity currencies (AUD, CAD, NZD) have all benefitted. Added to this, the sugar market...Read full article