login_img.jpg
Login ID:
Password:
Partner Login
Contact Us : 7066511911

Weekly: Sugar Prices Drop as Strong Dollar and Weather Concerns Influence Market Dynamics

10 Jun 2024 9:08 am
 Comments 0 Comments  |  Comments Post Comment  |  Font Size A A A 

Mumbai, 10 Jun (Commoditiescontrol): During the just concluded week, sugar prices experienced volatility, ending with a decline on Friday. The market retreated from its three-week highs as a stronger U.S. dollar, driven by unexpectedly strong non-farm payroll data, induced long liquidation pressure.

ICE sugar prices fell on Friday, pulling back from the three-week highs reached in the previous session due to a surge in the U.S. dollar. The dollar's strength, driven by a stronger-than-expected non-farm payrolls report, triggered long liquidation pressure. The July raw sugar contract declined by 0.22 cents, or 1.14%, to close at 19.04 cents per pound, after peaking at 19.33 cents per pound. Meanwhile, the August ICE white sugar contract in London dropped by $7.50, or 1.34%, to settle at $553.30 per metric ton.

Earlier in the week, risk premiums in sugar prices rose, driven by volatile weather conditions in key sugar-producing countries like Brazil, India, and Vietnam. Dealers noted that these conditions pushed prices to their three-week highs. India's monsoon rains have advanced into Maharashtra but are expected to weaken, leading to potentially lower-than-normal rainfall next week.

Analysts expressed concerns about crop conditions in Brazil and Thailand. BMI predicts a 1.5% increase in global sugar production to 185.7 million tons for the 2024/25 season, with consumption expected to grow by 0.5% to 179.7 million tons. However, sugar futures faced pressure from the Brazilian real hitting a 14-month low against the dollar, encouraging Brazilian producers to ramp up export sales.

Despite slower-than-expected production in Centre-South Brazil in early May, prices managed to recover from an 18-month low of 17.95 cents in mid-May. Continued dry weather in Brazil until mid-June has raised concerns about the latter part of the crop season. In Australia, a temporary halt to industrial action by workers at the largest sugar producer occurred after the company announced that participants would be barred from mills and not receive pay.

Brazil's sugar shipments have been strong, with vessel numbers up around 40% compared to the same period last year, reflecting robust demand. Over the past nine weeks, sugar prices have declined due to improved global supply prospects, driven by increased Brazilian production. On May 16, sugar prices in New York and London hit significant lows amid expectations of ample global supplies. Despite Brazil's current output surpassing last year's figures, a weaker second half of the season is anticipated.

The USDA projects a record sugar production of 186 million metric tons for the 2024/25 season, with demand peaking at 178.8 million tons. France's white sugar production increased by 5.8% for 2023/24, reaching 4.2 million metric tons. Global production shifts, including recoveries in Thailand and increased output in China, are influencing the market, with Datagro forecasting a modest global surplus of 1.62 million metric tons for 2024/25. Conversely, India's sugar production decreased by 1.6% year-over-year as of April 30.

Speculators have increased bearish bets on ICE U.S. raw sugar futures. The CFTC reported that funds reduced their net short position by 1,362 lots to 68,128 in the week ending May 28, prompting an intensified short-covering rally. Traders are closely monitoring developments, with technical support for the July sugar contract at 18.72 and 18.43 cents, and resistance at 19.33 and 19.65 cents. With rising production in Brazil and evolving global supply dynamics, sugar prices are expected to remain volatile in the near term.

We believe the recent decline in US sugar prices is merely a temporary setback, as underlying issues such as decreased Mexican imports and delayed plantings persist.

(By Commoditiescontrol Bureau: 09820130172)


       
  Rate this story 1 out of 52 out of 53 out of 54 out of 55 out of 5 Rated
0.0

   Post comment
Comment :

Note : This forum is moderated. We reserve the right to not publish and/or edit the comment on the site, if the comment is offensive, contains inappropriate data or violates our editorial policy.
Name :  
Email :  
   

Post Comment  

Latest Special Reports
Weekly: Sugar Prices Decline Amid Strong Brazilian Outp...
Weekly: Sugar Prices Drop Amid Forecasts of Higher Rese...
Weekly: ICE Sugar Futures Surge on Production Concerns ...
Weekly: ICE Sugar Return To Losses on Robust Brazilian ...
Weekly: ICE Sugar Futures Revived By ISO's Global Defic...
more
Top 5 News
US cotton net sales for July 5-11 at 27,200 RB, hit mar...
US soybean net sales for July 5-11 at 360,100 MT, up 73...
Cotton Spinning Industry Set for Recovery in FY2025, Ex...
USDA Forecasts Global Cotton Production Surge, Expects ...
Argentina's Currency Market Intervention: Will It Reviv...
Top 5 Market Commentary
ICE/ZCE Daily Rates Update ( Time: 19:15 ) - 18 JULY 20...
DCE Daily Rates Update ( Time: 19:14 ) - 18 JULY 2024
Panjab Sugar Prices -19 July 2024
Madhya Pradesh Sugar Prices -19 July 2024
MAIZE NEWS
Copyright © CC Commodity Info Services LLP. All rights reserved.