Sugar #11 Mar’22

The day started on a mildly positive footing as some mixed buying helped March’22 to nudge back above 18c, but while we were not seeing the kind of selling which caused so much damage yesterday there was an understandable reluctance amongst buyers to push too hard. This seemed justified when by mid-morning the market again started to probe downward and extended the recent move down to 17.77, though the absence of any sell stops combined with increasing scale buying ensured that the 17.60 support remained well protected. Values stabilised in this area and efforts were made to push back upward, but they failed at 18c leaving prices to struggle along near to unchanged. With prices remaining reluctant to fall by very far and encouraged by firmer London whites values there was a mid afternoon push which extended the daily gains up to 18.08, a minor success which laid the foundations for another rally to 18.12. The board was moving in unison and the fact that spreads were flat to last nights close will have concerned any bulls that may remain, something which may have been a factor when the flat price eased back below 18c once more as we moved into the final hour. A quiet closing period saw March’22 end with modest gains at 17.99 and we move into Friday with no real certainty as to the direction of the next move.

 

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Sugar #5 Mar’22

  There remains a good deal of vulnerability around the market currently despite the relative nearby strength and physical outlook and following some initial gains against hedge lifting the market resumed lower to extend the recent March’22 decline to $486.60. With little to guide us currently due to the macro disconnect it is proving hard to gauge the near-term direction, though the presence of consumer buying interest emerging across the board started to bring some confidence back to proceedings and lift away from the lows during the early afternoon. Spec activity of course means adds to volatility with the afternoon seeing a couple of small spikes upward as day traders moved, though on neither occasion did we build any real momentum with the price returning to hold the lower $490’s. The movement further aided the recovery in the white premium values with March/March’22 working up steadily to reach $97 midway through the afternoon, while the March/May’22 spread saw a brief spike to $11.50 before returning to the $10 area where it seemed fairly settled. Session highs at $495.10 were seen only briefly and the closing stages played out back in the lower $490’s, culminating in a settlement level at $492.50, a modest gain for the nears while the thinly traded forwards showed slightly greater gains.  

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Jon Whybrow

Jon joined CZ in 1991, working in the Treasury department before moving to join the derivatives team in 1994. Over 30 years Jon has built up significant experience across derivatives markets and products, particularly sugar, and is now Head of Flow derivatives providing market execution services for CZ’s global client base. He is responsible for the market commentaries which are published each day on CZ app.

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