Momentum was in one direction only today, despite the market opening 8pts higher we spent the day falling consistently. It didn’t take long for the October-22 contract to test the 18c mark, and from here we quickly established a daily low of 17.87c. A remarkable change in direction given we were trading almost 2 cents/lb higher at the beginning of the week. As expected the move below 18c uncovered consumer buying which offered the market some support. We now look towards the 17.71 level as a target for the bears, however given the speculative position stands at around parity it seems difficult to ignore the market trading towards the very bottom of a very well established price channel.
It seems remarkable that only a week ago the front month August’22 white sugar contract traded to $600. Today we saw another significantly weaker display in the whites market leading to a spot price print of below $524/MT. This was driven through weakness in the raw sugar market, however was met with a recovery in the white premiums, with March/March 2023 trading to $96, and May/May and August/July trading over $102. Fundamentally we remain wary of the impact that the heatwave has had to the European crop, and technically we now look towards the $520 level for support.
