It is tough for a market to continue making contract highs so consistently, and so the initial fall back to 20.86 is to be expected as some relief is found, with some longs happy to square off positions and reset. The market continued in the 20.80’s for a while though with sellers few and far between once the profit taking had eased up the rest of the morning was spent clawing slowly back up through the early range. A little more buying began to emerge with the start of the US morning and let May’23 to a very brief peek higher at 21.03 before a round of day trader liquidation extended the range to the downside with a slide to 20.77. This move down coincided with News that Datagro have revised their estimate for this tears Brazil crop to 38.3mmt sugar (from 590mmt cane), though with others talking the cane number above 600mmt post-Dubai the influence of this news was brief. The picture soon calmed, and the market settled into a tight 20.78/20.90 band through the rest of the afternoon. There was no change to this picture throughout a quiet close, with the day ending at 20.88, a solid showing given the consolidation with the picture still well set should the specs/funds wish to continue probing beyond 21c.
There were early losses for the market today as a lack of buying allowed the price to slide back to $582.90 over the course of the first hour, only then pausing to consolidate. This was in keeping with the chart pattern of the last two weeks and though things then settled down there was to be no immediate recovery with prices simply edging along within the lower half of the range through the rest of the morning. There was a small pick up during the early afternoon though that quickly ran out of steam, leaving prices to continue to move along quietly either side of $585.00. The macro picture was weakening through the day however sugar seems to bear no direct relationship to the herd currently with the sideways pattern maintained through into the final hour. Spreads meanwhile were again showing some minor signs of struggle with May/Aug’23 back into $12.70 while the May/May’23 white premium had fallen back to $123 at one stage before levelling back out around $125. A calm close saw May’23 ending at $586.00, still a solid showing which leaves the technical picture in tact for the bulls to potentially continue investigating higher.
