Commodity Prices – Sugar
Similar to corn, sugar is a seasonal commodity, which is mainly affected by the weather and overall economical situation in the producing countries. Another factor that affects the global sugar prices is the demand from the biggest countries that traditionally consume sugar (like India). The harvesting, production and consumers’ news are presented in the sugar prices category.
Commodities Tumble as Europe Battered by Problems
Commodities declined today, threatening to erase this year’s gains, as the problems continue to haunt Europe. Greece is a particular concern, being the most indebted member of the European Union. The country failed to form the government after the election on the weekend, fueling fears that Greece may leave the eurozone. The Standard & Poor’s GSCI Spot Index dropped for the fifth consecutive day.
Crude oil had its own bear story on top of Europe’s woes as Saudi Arabia signaled that prices for the commodity are high. Saudi Arabian Oil Minister Ali
June futures for delivery of crude oil slipped $0.93 (0.9 percent) to $97.01 per barrel on NYMEX. Brent fell from $113.33 to $110.53 per barrel before trading at $113.14 as of 21:05 GMT today on ICE. Gold dropped from $1,636.70 to $1,604.00 per ounce on COMEX today, reaching $1,596.00 intraday — the lowest settlement since January 4. Sugar tumbled from $0.2105 to $0.2033 per pound on ICE, while the daily minimum of $20.31 was the lowest since September 1, 2010.
Sugar Falls on Oversupply, Oil Declines as China Grows Slower
Sugar tumbled today as experts talked about oversupply in the market. Olam International Ltd. forecast that global output will exceed consumption by 10 million metric tons in 12 months ending in September. Farmers planted more cane and beet after prices reached a 30-year record last year, leading to this year’s surplus. Sugar price fell from $0.2433 to $0.2334 per pound on ICE today after touching $0.2328 — the lowest settlement since March 12.
Crude oil fell today on slowing economy of China and as Saudi Arabia signaled that it’s determined to lower prices. China’s gross domestic product grew 8.1 percent in the first quarter of 2012, slowing down from 8.9 percent growth in the previous three months. The median forecast was 8.4 percent. Ali
Commodities Tumbles as Europe Enters Recession
Commodities declined after a report showed that the eurozone economy contracted. Eurostat reported that eurozone gross domestic product fell 0.3 percent in the fourth quarter of 2011. The negative data hurt most commodities, including crude oil, corn, sugar, and wheat.
Crude oil also declined on the speculation that the European Union may resume negotiations with Iran about the Iranian nuclear program. Forecasters predict that today’s report will show an increase of the US stockpiles, adding to the downside factors for crude. As of agricultural commodities, experts forecast that supply will outpace demand for most of crops, decreasing prices even further.
April futures for crude oil delivery traded at $104.99 per barrel on NYMEX today after falling $2.02 to $104.70 per barrel yesterday. Brent traded near $122.12 per barrel on ICE today after yesterday’s drop from $124.27 to $122.32. Corn fell from $6.6475 to $6.5600 per bushel before trading today at $6.5800 on CBoT. Sugar was down from $0.2462 to $0.2406 per pound on ICE at yesterday’s trading session. Wheat was at $6.5325 per bushel on CBoT today, while it was down from $6.6625 to $6.5600 yesterday.
Oil Falls on Outlook for Demand, Sugar Drops on Higher Supply
Crude oil fell on the speculation the spreading Europe’s crisis will slash demand. Germany auctioned its debt yesterday and it was considered a disaster as there was a significant lack of demand for the government bonds, reinforcing concerns about Europe’s economy. The US economy also showed sings of slowdown. January futures for crude oil dropped $2.25 to $95.76 per barrel before trading at $96.45 on NYMEX.
Sugar prices declined on the outlook for higher supply from Brazil. Luis Pogetti, chairman of the Copersucar SA, predicted that production will go up to 34 million metric tons in Brazil’s Center South next year. India is also expected to add to the global supply. March contract for delivery of raw sugar fell 1 percent to $0.2321 per pound on ICE after reaching $0.2316 — the lowest level since June 2.
Sugar Falls, Soybeans Gain on Harvest Forecasts
Sugar declined on forecasts of good harvest. At the same time, expectations for soybean yield more pessimistic, causing the crop to gain.
Sugar was down on the signs of advancing output from Ukraine. Ukraine’s harvest of sugar beet was almost 29 percent larger than in the previous year as of November 1, according to the government report. The US Department of Agriculture estimated that Ukraine’s sugar exports will double in the 2011–12 season.
The USDA projections for soybeans, on the other hand, were more pessimistic. The USDA predicted that production in the USA will decline 8.5 percent to 82.9 million metric tons this year. The reason for the declining output is dry weather in parts of the United States.
March futures for delivery of raw sugar declined 1.6 percent to $0.2499 per pound by 8:21 on ICE. The weekly decline was 2.3 percent, while prices were down 22 percent over this year. Futures for delivery of soybeans in January advanced 0.7 percent to $11.755 per bushel as of 13:15 on CBoT.
Sugar Jumps While US Stockpiles Shrink to Record Low
US sugar stockpiles shrank to the lowest level in 37 years, making prices surge and forcing the government to increase import quotas.
The US Department of Agriculture estimated yield in Minnesota, the biggest beet growing state of America, will be 19 percent down from the previous year. Four more of the 10 biggest producing states may also have reduced output. The USDA forecast the US inventories of sugar will shrink more than 35 percent in the year through August 2012.
Retail prices for the sweetener have risen 9 percent since the beginning of this year. The rising prices caused the government to increase import quotas by 45 percent in 2011.
Spot price for sugar rose from 24.75 to 25.25 today as of 18:56 on ICE. Earlier settlement reached the daily maximum of 25.69.
Sugar Leads Agriculture Commodities in Rally of Its Own
The sugar futures managed to pare their recent losses and reach the highest level in more than a week today amid the positive market sentiment. It’s based on the German approval of the additional powers for the eurozone
Brazil is holding the worlds leadership in sugarcane growing with about 37 percent share of the global industry. News of the decreased sugarcane crops in this country due to the bad weather conditions have inspired the market last Friday. Now the seeds of these speculations have fallen on a fertile soil of the global market optimism.
German Bundestag approved the extra rights for the European Financial Stability Facility — the eurozone
The US statistics played its role in the rise of sugar prices today — last week’s unemployment claims turned out to be about 7 percent lower than the median forecast of the economic strategists was showing. Additionally, the second quarter of 2011 GDP growth figure was revised positively in the United States. These factors added to the reasons for the bull markets today.
Sugar futures contracts with September 30 delivery rose from $25.62 to $27.08 for 112 pounds or about 5.7 percent as of 17:47 GMT today. The highest intraday level was at $27.64 — commodity’s maximum price since September 21.
US Farmers Reduce Herds, India’s Sugar Production at Record
US farmers may cut most of their breeding cows to reduce losses because of drought. Texas ranchers may sell or slaughter 500,000 beef cows as the dry weather made them to expensive to feed. The losses of the states’ farm may reach $5.2 billion as the past 11 months were the driest since 1985 in the region. December futures for delivery of cattle advanced 1.1 percent to $1.192 by 13:00 on CME.
India’s production of sugar may reach a highest level in four years. Analysts predict the output may total 25.83 million metric tons in the year starting October 1, compared with 24.2 million tons estimate for this year. The high production may prompt India to lift the limit on exports. The resulting boost of supplies on global markets can drive prices down. Sugar spot price fell 1.1 percent to $0.2760 from $0.2790.
Rice Posed to Gain on Inventories, Sugar Falls on Supply
Rice is expected to surge as the smallest increase of inventories in five years may create deficit on markets. Stockpiles increased only 1.1 percent this year, compared to 29 percent in the past four years. The estimates of the US Department of Agriculture predicts signal that supply, being 456.2 million metric tons, still exceeds demand (455.2 million tons). Yet market analysts predict that prices will jump 20 percent by the end of this year. So far, prices for rice advanced 15 percent from May.
Sugar fell today on the speculation that India will increase exports, causing supply to exceed demand. On the other hand, China and Indonesia are going to expand their purchases of the commodity, potentially supporting prices. October contract for delivery of raw sugar slipped $0.0022 (0.8 percent) to $0.2762 per pound as of 12:24 on ICE.
Sugar Falls as Shipments from Brazil Rise
July sugar exports from Brazil (the world’s biggest sugarcane producers) climbed to the maximum in eight previous months, pushing the market prices for this commodity down to 2-week minimum.
From the technical analysis point of view, the decline is finely justified as a correction that followed a sharp rally in July. That rally was induced by the rumors that Brazilian production will decline.
The market analysts point out the fact that the buyers are currently afraid of the tons of supply that may get into the market anytime. If that happens, supply may overwhelm any demand, sending the prices down the hill.
September sugar futures fell from $29.02 to $28.27 per 100 pounds or more than 2.5 percent as of 17:17 GMT on ICE today. It’s the lowest level since July 18.
