Sugar #11 Futures Market News and Commentary
March NY world sugar #11 (SBH22) on Tuesday closed up +0.32 (+1.67%), and March London white sugar #5 (SWH22) closed up +9.00 (+1.81%).
Sugar prices on Tuesday rallied to 1-week highs and closed moderately higher. Strength in crude prices (CLF2) on Tuesday sparked a rally in sugar. Crude oil jumped more than +4% to a 1-week high, which benefits ethanol prices and may prompt Brazil's sugar mills to divert more cane crushing toward sugar production rather than ethanol production, thus boosting sugar supplies.
Last Thursday, NY sugar fell to a 3-3/4 month low, and London sugar dropped to a 2-3/4 month low after crude (CLF22) prices plunged to a 3-1/4 month low. Sugar prices have been on the defensive since Nov 24, when Unica reported that the total amount of sugarcane crushed in the first half of November fell -38% y/y to 12.5 MMT, a smaller-than-expected decline than expectations of -57% y/y to 8.7 MMT. The total amount of sugar produced fell -49.7% y/y to 626,000 M... Read more