• There’s been little movement in the No.11 and No.5 across the past week.
• The specs seem tentatively bullish after a few weeks without clear sentiment.
• The strengthening Z/H spread ahead of the Z’21 expiry seems positive for physical demand.

New York No.11 (Raw Sugar)

• The No.11 barely moved across the past week, further underlining the lack of clear sentiment about direction of travel.
• The lack of price movement means a strong spread structure remains through 2022, which will discourage short-term buying.

No.5 London (White Sugar) 

• The past week has been quiet for the white sugar market.
• The only notable price change was a slight rally in the Z’21 as the expiry nears.
• The strengthening Z/H spread could be a sign of demand recovery.
• Open interest has recovered in the H’21 to align with historic levels; this is a positive sign for refined demand in 2022.

White Premium (Arbitrage) 

• White premiums remain below the margin needed by the refineries, especially considering how high freight rates have impacted refiner costs.
• The recent weakening in bulk shipping costs has reduced the margin required, though.
• White premiums have also weakened, meaning the market is still well away from profitable levels.