• The decline seen over the past few sessions has impacted on volumes as we embarked on a quiet morning of consolidation, broadly holing the mid-14.20’s basis March’20. Much of the early volume was being seen in the spreads and this continued into the afternoon as prices edged a little lower still, recording a low of 14.05 though interestingly still performing better than much of the macro which has remained under pressure from the Coronavirus situation. Headlines that OPEC is considering production cuts in reaction to the impact of the aforementioned coronavirus gave the macro a shot in the arm mid-afternoon, with No.11 punching up to a new session high of 14.39 in quick time on some aggressive spec/algo buying to place it behind only the energy sector in the daily macro standings. Following the gains made during December and January one thing we know is that the specs retain a strong desire to push the long side, and this move provided just such an opportunity to push further still as they looked to reverse the recent decline. Following some brief consolidation we were soon accelerating upwards once again, this time surging through 14.50 to quickly make another new session high at 14.75 and placing Sugar well clear as the top performing of the commodity sector for the day. Understandably there was a pullback from the highs late on as day traders liquidated longs, however this still left March closing an impressive 33 points higher at 14.54.
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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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