Australian Exports Overlooked by Sugar Futures

You wouldn’t expect this after today’s big up-side sugar futures move today, but global sugar supplies are expected to inflate after Australia is reporting larger than anticipated production.  Their the world’s third biggest exporter of sugar and their exports are predicted to increase to a three-year high from higher sugar field yields.

Australian government officials are reporting a 13% increase in sugar exports for July than they had estimated in March.  The amount of sugar exported will be the highest since the end of their fiscal year ending June of 2010.

Barb Levy, chief director of the futures division at Futures & Options Xecution in Chicago, stated today in an e-mail interview regarding the current sugar futures situation, “A higher move in the sugar (futures) today may be short lived as Australian sugar exports could hit a three year record high level, bringing more focus to a possible global (sugar) supply surplus.”

We are long sugar futures with the very first long trade of the newfound trend.  Seasonally speaking, sugar futures can continue to trend higher until November, but with this new report revealing Australia’s higher sugar production, the sugar futures uptrend could be short-lived…

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