Brazil Production Sends Sugar Futures Lower

There is now a consensus with higher sugar production in Brazil, there will quickly be an addition to the global surplus of inventory.  Sugar futures has been lower for a third day on this outlook with the world’s largest sugar supplier ramping-up stockpiles.

A sugar industry group in Brazil says for the fiscal year beginning April 1st, the nations biggest growing region should produce just more that 4% than expected from an earlier estimate in September.  With Brazil’s sugar cane crop climbing almost 10% than the year before, the sugar group estimates a global sugar surplus of 26% greater than current demand.

With slow (sugar) import demand from China and Russia, and the International Sugar Organization recently increasing the world production surplus to 6.18 million tons, sugar looks to be moving lower,”says Christian Moreno, a commodities broker for HighGround Trading Group in Chicago, regarding the current sugar futures situation.

Sugar futures are indeed in a technical downtrend, however, they have been trading more sideways lately.  We are currently short sugar futures at this time.

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