Can you pass me the sugar please?
Sugar was one soft commodity not participating in the sell-off of mid-2008. Capitulation only came last winter.
But now sugar is making a spectacular come-back.
As Dresdner Bank writes:
Sugar prices are close again to the 4-month high recorded at the start of February, at 13.37 US cents a pound. Numerous market observers have revised their forecasts of an expected deficit on the sugar market this year downwards, some quite significantly. Sugar broker Czarnikow or the consultancy Kingsman expect a market deficit of more than 10 million tons. This week, India, the world’s second largest sugar producer, lowered its forecast for sugar production in this crop year (October to September) by 1.5 million to 16.5 million tons. This would mean a fall in production of about 10 million tons in comparison to last year. As India is also the world’s largest sugar consumer, this has huge implications on the market balance.
Sugar was one soft commodity not participating in the sell-off of mid-2008. Capitulation only came last winter.
But now sugar is making a spectacular come-back.
As Dresdner Bank writes:
Sugar prices are close again to the 4-month high recorded at the start of February, at 13.37 US cents a pound. Numerous market observers have revised their forecasts of an expected deficit on the sugar market this year downwards, some quite significantly. Sugar broker Czarnikow or the consultancy Kingsman expect a market deficit of more than 10 million tons. This week, India, the world’s second largest sugar producer, lowered its forecast for sugar production in this crop year (October to September) by 1.5 million to 16.5 million tons. This would mean a fall in production of about 10 million tons in comparison to last year. As India is also the world’s largest sugar consumer, this has huge implications on the market balance.
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