Sugar #11 Mar ’22
The new week commenced with some light buying which took March’22 up to 18.20 however the rally soon stalled to leave prices back in the red once more. Friday evening’s COT report showed a further reduction in the spec long position to 109,233 lots and though volumes over the past three sessions have been on the low side the expectation would be that a live position may now be beneath 100,000 lots due to continuing liquidation. That became the watchword as we moved through the rest of the morning with the price soon working down to break Friday’s 17.99 low and into the 17.80’s with only the usual scale buying interest present to provide any semblance of support. Moving on into the afternoon there was no change to the pattern with the decline extending as far as 17.60 before we found any respite. Despite the technical weakness this area does bring us near to ethanol parity and so brings more reason for buyers to step in, if only in anticipation of a corrective bounce, and the remainder of today’s session played out away from lows with some short covering taking March’22 back to 17.88 late on following the establishment of a settlement level at 17.83, which of course still represented another loss. If the ethanol parity can provide support, then maybe the market can build a base/recover with selling unlikely to be seen in any great quantity for the immediate term with little technical resistance found until the old low at 18.46.
Sugar #5 Mar’22
The latest in a series of weak performances on Friday drew out a small level of physical interest however once the hedges had been lifted so the path quickly resumed lower once more with the $482.50 December low providing the initial focus. It was not long before this level came into sight and though there were very few sell stops in place as sellers pushed through neither was there a great deal of buying and so we saw March’22 trading beneath $480 as we moved into the early afternoon. With the current moves being driven by the technical picture as specs continue to liquidate longs on more positive news of crops in Thailand and India it has proved difficult to hold, aiding consumers who are happy to continue to price on a scale down basis. For the third time in a week the afternoon was interrupted by an aggressive market buy order which this time spiked March’22 to $486.00 though the general trend remained downward, and session lows were subsequently recorded at $477.60. Pressure eased during the final couple of hours wit the front of the board peeping back over $480, settling away from the lows despite remain negative for the day.
