Friday’s stronger performance combined with COT data that showed only a modest increase in the net long to 158,765 lots had many anticipating another look higher today, particularly given the opportunity presented by the Carnival holiday in Brazil. Instead, what we saw was a decline driven by macro weakness with concerns mounting regarding the coronavirus pandemic following the actions taken in Italy to “quarantine” some towns. The losses increased during the morning with May losing more than 25 points before finding a degree of support in the mid 14.80’s. This still placed sugar ahead of many other commodities in a commodity world where the only markets recording meaningful gains were the traditional safe havens of Gold and Silver. In quiet trading we were pushed down to 14.73 by some early afternoon spec selling, then saw further consolidation until another burst of spec selling during the final 30 minutes kicked us back towards the lows. MOC selling saw us record session lows at 14.71, with May’20 settling just above at 14.73. With macro clearly outweighing the fundamentals today there will be a keen eye on the wider commodity sector again tomorrow.
