Analyst Insights

• Global sugar production will total 176.7m tonnes in 2020/21, up 14.3m tonnes year-on-year and almost identical to that of 2018/19.
• Even with the COVID-induced fall in consumption, the world will still produce 5m tonnes more sugar than it consumes, meaning stocks will rise throughout the 2020/21 season.

• Pakistan had 112% more rain than usual last month, which improved yields after a dry July. 
• This means it should produce 5.1m tonnes of sugar in 2020/21, up 300k tonnes year-on-year.
• The increase also comes as many former cotton farmers now plant sugarcane to earn more money.

Daily Market Price Update and Commentary 9th September 2020

• This is the first piece of a larger series focussing on Sustainable Agriculture.
• We’ll discuss its importance when trying to meeting our current global food needs without compromising our future needs. 
• The series is brought to you by Mark Oulton, former Manager and Trader at Cargill (18 years) and Global Research Manager at SGS (11 years). 

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• Before the CFTC data collection, it was a quiet week in the No.11 market with the net spec position barely changing as price remained within a 20 point range.
• Since, however, price has fallen sharply, putting to bed concerns about a rally in the near future.
• In white sugar, there was no notable change to the significant net spec long as prices remain steady above $350/mt.

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• China may need to import around 10m tonnes of corn next season. 
• Its corn purchases were strong last week, but this couldn’t save the market from falling. 
• China should continue to play a major role in price behaviour as it continues to buy grains to fulfill the Phase One Trade Agreement and its needs. 

• Bangladesh has imported 1.9m tonnes of raw sugar so far in 2020, up 20% year-on-year.
• This is an unusually large amount for Bangladesh to import but record imports in Q1’20 left stocks high as coronavirus battered sugar consumption. 
• We think imports will now slow down until domestic stocks reach a comfortable level. 

• Nominations have slowed down, but China remains as top destination.
• CS saw 380kmt of raws nominated this week.
• September has already 2.4mmt nominated.

Daily Market Price Update and Commentary 4th September 2020