REPORTS

The Fund short covering rally seems to be over, with their net position having stabilised in the low 30 000 net long area for 3 weeks,
a lot of people expect a pull back Possibly it would have happened if the US air strike had not occurred But to us it looks as if the
market had settled down at what looked like fair value
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Funds more or less neutral
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Producers having caught up with their selling, so also neutral
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Flat price around probable mid point of 2020 ethanol parity expectations
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Continuing weather concerns, notably in Thailand for the following crop
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In other words it looks as if we may be in the middle of the new sugar price range
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What to look out for? Certainly cash values are strengthening slightly, which may indicate a strong March expiry And if the Thai dry
weather persists then replanting of new cane and growth of existing cane could be seriously jeopardised If then the Indian crop turns out
to be at the lower end of expectations we could have the makings, not of breaking out of the ethanol parity range, but of moving into a
new, higher range
•But Crude will remain the main driver