{"id":1223,"date":"2020-11-19T20:51:28","date_gmt":"2020-11-19T20:51:28","guid":{"rendered":"https:\/\/campus.hesge.ch\/commodity-trading\/?p=1223"},"modified":"2020-11-20T07:08:45","modified_gmt":"2020-11-20T07:08:45","slug":"sugar-bulletin-2","status":"publish","type":"post","link":"https:\/\/campus.hesge.ch\/commodity-trading\/sugar-bulletin-2\/","title":{"rendered":"Sugar \u2013 Bulletin #2"},"content":{"rendered":"\n

Covid-Recovery effects on Sugar Market<\/p>\n\n\n\n

In order to make a small recap on the price, let\u2019s remain the last price of the first bulletin. As we can see in the graph below, the 28th<\/sup> October the price was reaching 0.1379$ per pound. Today\u2019s price is 0.1483$ per pound. We have forecasted that prices will fall down and comsumption as well. However, our predictions were wrong. In fact, prices tend to go up. But still we can see declines. Especially one decrease that can be explained by the US election on the 3rd<\/sup> November. In fact as we can see just after there is a substantial fall decrease. This is beacause of the market uncertanity due to the US election and also Trump\u2019s reaction.<\/p>\n\n\n\n

Sugar price in USD\/pound<\/em><\/strong><\/p>\n\n\n\n

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Source: https:\/\/www.fxempire.com\/commodities\/sugar<\/a><\/em><\/p>\n\n\n\n

Let’s focus on Brazilian production<\/strong><\/p>\n\n\n\n

Brazil will increase sugar production by 11 million tonnes and exports will rise by slightly more than this. We can explain this important production by the fact that the economic crisis has had a very significant impact on the price of oil. In February, the price of oil fell to its lowest level since 2003. On November 19, the price of oil doubled since February, but it still remains relatively low.<\/p>\n\n\n\n

The low price of oil has had a direct impact on sugar production. Becoming uncompetitive as a source of fuel, producers focused on sugar production, thus maintaining production at a high level.<\/p>\n\n\n\n

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Source : Point 3 NEW LMC_Prospects for the World Sugar Market_SMO 12 Nov 2020.ppt<\/em><\/p>\n\n\n\n

Given that social and economic activities remain uncertain worldwide, this tendency of producers to focus on sugar production rather than ethanol production could continue for a few more months. For us, this trend can only change when the situation and the impact of COVID-19 is fully controlled by countries around the world.<\/p>\n\n\n\n

Sugar price evolution in the coming months<\/strong><\/p>\n\n\n\n

For us, the price will continue to increase for various reasons:<\/p>\n\n\n\n