• Last night’s technically constructive close at 15.04 enabled the market to maintain the higher move, nudging up towards the recent 15.12 high during the morning before pushing through this level to register new highs mid-session. The noises being made in Dubai remain favourable towards the near term prospects, however ISMA were keen to point out that the low Indian crop this year should be treated as an exception with a return to the 33m area anticipated for next year. This did not halt the afternoon rally though with March’20 continuing to strengthen on route to a session high of 15.35. This placed sugar once more to the top of the CRB as we continue to significantly outperform the macro, with several other daily gainers simply treading water within recent ground while Sugar breaks new ground. The upward trajectory has clearly been accelerated by the industry gathering in Dubai with the various gatherings accentuating the bullish view, and more impressively the move has taken place in an FX environment that has today seen further new record USDBRL lows at 4.3377. Renewed aggression from longs sent March’20 to new highs during the final 30 minutes, now targeting the 15.49 continuation high which dates back to November 2017. We halted just beneath this target, reaching 15.46 and settling just below at 15.41 to register yet another impressive technical showing. With traders boarding planes out of Dubai tomorrow we wait to see whether the momentum can continue to investigate beyond 15.49 given the recent return to overbought conditions.

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Jon Whybrow

Jon joined CZ in 1991, working in the Treasury department before moving to join the derivatives team in 1994. Over 30 years Jon has built up significant experience across derivatives markets and products, particularly sugar, and is now Head of Flow derivatives providing market execution services for CZ’s global client base. He is responsible for the market commentaries which are published each day on CZ app.

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