Insight Focus
- The No.11 has rallied above 19c.
- The weekly increase in net spec position was the third largest on record.
- Sugar producers have exploited the rise above 19c, adding lots of cover.
New York No.11 (Raw Sugar)
- The No.11 rally at the start of March has been reflected by a large increase in bullish speculation.
- As of the 8th March, the spec long grew by over 46k lots, whilst the spec short shrunk by 36k lots.
- The net spec position grew by over 82k lots in response, the largest weekly rise since the start of 2020.
- This marks the end of the low spec involvement in sugar seen so far this year.
- Producers have also been keen to exploit the rise above 19c, adding almost 90k lots to the commercial short – consumer hedging by contrast has almost completely halted.
- No.11 prices since the 8th March have hovered just above 19c.
London No.5 (White Sugar)
- This new bullish sentiment is mirrored in the No.5 as the net spec position has grown by over 7k lots as of the 8th March CFTC report.
- In the week since the 8th, white sugar prices have stabilised around 530 USD/mt.
- Whilst flattening slightly, the No.5 forward curve is still backwardated into 2023.
White Premium (Arbitrage)
- The K/K white premium remains strong, sitting comfortably above 100 USD/mt.
- Whilst this is positive for re-export refiners, the oil and energy price rally means their margins could be heavily squeezed through rising energy costs.
For a more detailed view of the sugar futures and market data, please refer to the data appendix below.
No.11 (Raw Sugar) Appendix
No.5 (White Sugar) Appendix
White Premium Appendix
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