REPORTS

The sugar bulls will point out however, the Brazilian Real has strengthened since December (roughly 5%) and there is less incentive for pricing with a “double whammy” of lower futures and worse FX to local currency. The sugar bears will argue in the last month we have a clearer perspective on India and there are better indications to more optimistic on crop expectations and potential for Indian exports, furthermore, the whites market has since indicated with its slip back to contango and rumoured build-up of EUs that the fundamentally looking bear market last month looks more bearish from their perspective.

Headlines are taken by world leaders at the economic forum taking place in Davos and newswires/market analysts continue to highlight the disparity in divergence of commodity prices and equity prices. Commodities are described as being in comparison as “unprecedentedly cheap”. However and perhaps more pertinently on looking around the agri basket we saw the net specs add to shorts in Corn, Wheat, Soy and coffee as well as Sugar.