Posts Tagged ‘sugar prices’

Brazilian Rains Help to Boost Sugar Futures

Sugar futures eased back a bit today following yesterday’s 3% rally on news of rains in South America helping to extend the current rally. Sugar futures closed down 13 points to settle trading today at .1130 cents per pound at the Intercontinental Exchange .

Despite the sentiment of sugar being more abundant than sand on the beach, bullish factors are emerging such as the Brazilian rains seen stalling the sugar-cane harvest in South America’s center-south growing region, and sugar output behind analysts expectations last month. Brazil is one of the world’s top producers of the sweet stuff and mills in that region are responsible for reportedly 90% of the country’s sugar output.

The technical trend for sugar is down, however sugar futures are at a crossroads at this time. A trade above .1165 in the near-term could push sugar futures to an uptrend while a trade down to .1084 could keep the lower prices intact – a plus for the consumer.


Sugar Futures Expert Expects No Quick Recovery

Sugar futures were hit with a glut following multi-year highs in 2011 and has since given back two-thirds from its high prices, but one expert says sugar prices may recover in the 2016-17 season. Sugar futures are down 12 points from yesterday’s close closing the day near 10.61 cents per pound at the Intercontinental Exchange.

The top sugar producing and exporting countries (such as India & Thailand) actually subsidize sugar growers and this fact could keep a lid on higher prices short-term – says the CEO of a Brazilian sugar company. He goes on to say that investment has been rather low in cash-strapped sugar mills and this fact alone could see lower volumes of sugar production which will support values to the product.

The technical trend for sugar is down with no bottom yet in sight. Pretty soon holiday demand for sugar should pick-up, but I don’t see any fundamental issues that would change the overall trend happening any time soon – enjoy the low consumer prices while we can.


Sugar Futures Extend Low’s With Oil’s Drop

Sugar futures have extended their lows, yet again, to prices not seen in years as demand for the sweet-stuff reportedly remains subdued. Sugar futures ended the day down 14 points at $0.1510 per pound on the ICE Exchange.

Sugar futures, as well as crude oil futures, are two (of “22” total) commodity futures markets that comprise the Bloomberg Commodity Index. These two markets have helped slide the commodity index to a five-year low.

The technical trend for sugar futures is down with no bottom yet in sight. I will be looking for a way back in the “short-side” of this market as I believe I was prematurely stopped-out very early this morning.


Sugar Futures May Reverse on Looming Shortage in Brazil

With drought cutting into supplies in Brazil, the global sugar market is shaping up to be in its first deficit in half a decade (claims a top exporter and producer there). Sugar futures have recently climbed to .17 and one-fifth cent a pound in the larger rallies in two months.

Sugar futures have plummeted over 50% from their highs since 2011 as farmers planted more sugar cane, but now both Brazil and India are considering reducing sugar output (to reduce global reserves) for the first time in four years, the USDA estimates. Also, Brazil – which a forthcoming presidential election soon – has already raised the amount of sugar-ethanol used in fuel and may soon raise gasoline prices there.

The technical trend for sugar futures is at a crossroad. Sugar futures have technically crossed the uptrend threshold (in my work), but appear to be testing their recent lows. I must approach sugar futures with caution.


Global Surplus Takes Sugar Futures to 2010 Lows

Sugar futures continue to find new lows as the world’s biggest sugar producer has stepped-up output of the product. Sugar futures are at prices not seen since 2010 now that Brazil has effectively expanded the global “glut” of sugar production.

Brazilian sugar industry group “Unica” claimed yesterday in a report their biggest sugar growing region in the country’s center-south is already producing 4.4% more sugar than this same time last year. Sugar futures have already declined over 27% from this year’s high in March.

Even though the (sugar) harvest in Brazil is starting to slow down, production for this season is still well outpacing demand.  Additionally this is the fourth consecutive season of oversupply of sugar,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, sharing her insight regarding the current sugar futures situation.

The technical trend for sugar futures remains down with no bottom yet in sight. We are short sugar futures since last week on this entire last leg down.


Sugar Futures Lower as Kerry Mends US-Mexico Ties for Trade

Sugar futures finished “down” for a fifth day in a row as US Secretary of State Kerry is in Mexico to solidify details for a trading pact throughout the Pacific-Rim. There continues to be an underlying rift between Mexico & the US over sugar (and “steel” amongst other things) which is straining ties between our two countries.

If Secretary of State Kerry is successful in finding common ground in bolstering trade and security, not only with Mexico, but with 10 other Pacific-Rim nations, this will be an economic alliance that is the largest in history. Sugar futures have been in an overall down-trend since late last year in part because Mexico sugar producers are being accused of flooding the sugar market with their product at the US’s expense.

The technical trend for sugar futures is down with a possible bottom in sight. If sugar futures can retain the $0.17 cent support level, and trade higher from here, then this market will be at a crossroad.


Sugar Futures Grind Lower as Exports From India Slowing

Sugar futures continue to pull-back as shipments of sugar from India – the world’s second-biggest producer of sugar – have slowed after sugar prices reached a 15-month high earlier this year. The largest sugar refiner in India said they are considering “export incentives” in an effort to promote their product, but so far no decision made.

To give you an idea of the sugar export slowdown, India’s exports may total nearly 300,000 tons in the six-month period into September, and when you compare this with the 1.5M tons exported in the six-month period prior, you can clearly see the concern. The slow exports may be supporting sugar prices temporarily, but there are forecasts for a global sugar deficit because of the adverse weather in Australia & Brazil.

The recent drop in sugar futures has begun to taper off as the supply situation remains in question. India’s sugar output for 2014-15 is expected to rise 3 percent but a growing domestic consumption expectation will result in tighter supplies,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, regarding the current sugar futures situation. Levy added, “Additionally sugar production out of Brazil shows a large amount of near term supplies but there is much concern over smaller harvest figures for the sugar still in the fields.”

The technical trend for sugar futures remains down. There seems to be volatility on the sugar futures charts down here at these levels that keeps me out of this market.


Profit Taking on Rains Sinks Sugar Futures

Sugar futures sold off significantly for the first time in a week as traders took profits before rains come to the thirsty sugar growing region of Brazil.  Brazil is the world’s top producer of sugar and right now there is enough dryness to seriously threaten the production of this year’s crop.

This month alone sugar futures have seen a 12% advance and the biggest single monthly gain since the early summer of 2011.  The main sugar growing area of Brazil’s center south is plagued with less precipitation which is expected to diminish production by 6.5%.

Sugar futures saw early pressure as traders were taking profits after the recent rise. By the session end, however, losses were scaled back to just a few tics due to concerns of damage to Brazil’s crop, stemming from ongoing drought conditions,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, regarding the current sugar futures situation.

The technical trend for sugar has emerged upward only recently this month.  I am looking for opportunities to go long sugar futures from here on out.


Slowing Brazilian Supply Boosts Sugar Futures

Sugar futures may be trying to turn the corner after making a spectacular high in mid-October.  It seems there are signs of dwindling supply of sugar coming from the worlds biggest exporter and producer of the sweet stuff.

A Brazilian sugar-industry group stated today in the first-half of November, sugar mills in the main growing region in Brazil’s South Center was able to process only 90% of their production from a year earlier.  Plus, companies there use more sugar-cane to produce ethanol for energy purposes – so the demand is there constantly.

Christian Moreno, a commodities broker for HighGround Trading Group in Chicago, had this to say regarding the current sugar futures situation,Sugar continues to be unable to have two positive closes in a row, as the last time that occurred for March futures was October 11th-14th.  The path of least resistance is pointing downward.” 

The technical trend for sugar futures is down, and it has been a steady downhill ride since mid-October when prices were 0.035 cents higher than they are now.  I really would prefer sugar futures to provide some type of rally before jumping back on-board.


Indian Mill Shutdown May Lift Sugar Futures

Sugar futures may be starting a much needed lift after dropping more than 2.5 cents from its high only last month.  Apparently some sugar mills in India are extending what was once a temporary shutdown which can potentially curb global output – they’re the world’s second-largest sugar producer.

The underlying problem is the Indian government enacted artificially high prices for the sugar mills to pay the sugar farmers and the mills claim they simply can’t afford these high sugar prices.  Indian sugar producers can afford to pay 225 “rupees” per 220lbs of sugar, but their government has set the price at 280 rupees – almost a 20% difference.
Barb Levy, chief director for The Fox Group’s futures division in Chicago, had this to say about the current sugar futures situation,The mills shutdown will reflect in sugar (futures) prices eventually.”

The technical trend for sugar futures is down and their has been no significant interim rally from the mid-October highs.  We must be patient with sugar futures until a more lower-risk scenario unfolds.

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