Sugar #11 Oct’21
There was some steady buying showing during the early part of today’s session which took the market upward and though outright volumes were moderate at best the lack of any significant selling around current levels enabled the price to steadily rise to 19.98 over the course of the morning. A small pullback followed ahead of the US morning as some day traders locked in profits however when the Americas contingent kicked off they brought with them some better buying as specs showed for the first time in a while with some active participation. This sent prices up through towards 20.20 while another wave of interest followed which caused a sharp uptick to 20.27, though this second move was short-lived and was followed by some long liquidation which just as quickly returned us to where we had started at 20.20. With the Oct’21/March’22 continuing in the low to mid -0.70’s against decent rolling despite having now concluded the index period it was proving a deceptive volume which made the move all the more interesting as once the spreads were removed there was decidedly little volume on show for a market that showed gains of around d70 points for the day. Today also represented the expiry of the Oct’21 options and this seemed to be a factor as the latter stages saw the front month holding around 19.50 despite the relatively modest open position at each strike, while March’22 was happy to consolidate within 10-15 points of the earlier highs. As an aside there was a vast number of EFS transactions posted today, totalling more than 30,000 lots which alongside the spread activity should have a significant impact upon the Oct’21 OI figure tomorrow. A relatively calm close saw March’22 settle at 20.26 to cap off a strong performance, the questions now being whether the specs will want to continue to add to their longs and should they do so then will the upper 20’s see an increase in desire to price from producers.
Sugar #5 Dec’21
With the Oct’21 expiry upon us but the open interest having fallen beneath 3,000 lots its seems that all was done bar the shouting and so attention was able to focus upon the flat price activity. Here we have seen a resurgence in recent days and that continued from the start with Dec’21 quickly trading up by some $7 against only light buying and then happily consolidating this area despite the reluctance of No.11 values to follow suit. Soon this led to a further steady increase in value and though the buying remained moderate there was no selling of note to be seen and so it was that we were trading above $510 by the end of the morning. Another surge upward followed to coincide with the start of the US day and in a remarkable turnaround this took the flat price onward to $516.40 by mid-afternoon, the highest level seen since 18th August and an incredible $31 above the lows seen just two days ago. Though No.11 was also surging it failed to keep pace with the whites which led to some intraday improvement in white premium values as Dec/Oct’21 traded into the upper $80’s while March/March’22 touched out towards $75, though both fell back by several dollars during the later afternoon. This was because the selling emerged to temper the flat price back into the range though it recovered sufficiently from the long liquidation to settle only a couple of dollars shy of the highs at $514.50 and suddenly appearing set to look towards the contract highs.
· Tonight’s Oct’21 expiry has seen 2,496 lots / 124,800mt tendered with suggestion that we may see both Indian and Guatemalan sugars in the tape. Full details will be published by the exchange tomorrow.
ICE Futures U.S. Sugar No.11 Contract
ICE Europe Whites Sugar Futures Contract