Raw sugar futures have traded choppily over a 100 point range this week. Tests of 17 cents and 16 cents have been met with decent resistance and support. Monday night’s session illustrating perfectly as prices slipped toward 16 cents, only to be marched 60 points higher in the final hour. Last week India announced it would import 500 kmt of duty free raw sugar this year, a non-event which did very little to support raws. Again specs were net sellers across the week, trimming their long position to 26,500 contracts. Looking ahead, Brazil now becomes a key market driver, beginning their 17/18 harvest over the past fortnight. Increased support for raw sugar is anticipated with the natural increase in ethanol production expected as mills begin to fire up.
AUD price action has been highlighted by a recovery back toward 76 cents. Attributed to, by stronger local employment data and China trade, the biggest indicator lay with Trump talking down the USD. Trump highlighted his wishes for a weaker dollar and low interest rates stating, ‘I do like a low interest rate policy and it is very hard to compete when you have a strong dollar and other countries are devaluing theirs’. Little fresh news from RBA yesterday, who continue to highlight the concern for the local housing market and employment growth. In the near term, the AUD remains under pressure with commodities continuing to slide lower. A break of 75 cents would see a test of support near the key 0.7480 level.