v\:* {behavior:url(#default#VML);} o\:* {behavior:url(#default#VML);} w\:* {behavior:url(#default#VML);} .shape {behavior:url(#default#VML);}

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;}

Tuesday November 18, 2014

World sugar futures posted a recent high at 16.44 last Wednesday and have quietly shed 79 points, or 4.8 %, since basis today’s low. March has printed lower highs, lows and settlements each of the past four sessions in indifferent dealings. As for today, prices settled six lower in March at 15.71 and from four to 10 lower in the back months. Traded volume was 56,486 lots – as good an indication as any of the session’s energy level. On spread, March/May traded from 34 to 38 under and last at 37 under. May/July traded from 23 to 26 under and last at 24 under.

Option watch: Option volume was a brawny 24,509 contacts with more than 50 % traded in the March calls. Vol’s in the front months drifted lower. January vol is 17.71, down .43 %; March vol is 18.04, down .43 %; and May is 17.00, down .39 %. Trades of note: 1,630 January 15.00 Puts trade 6-7, 500 January 16.00/15.50 Fences trade flat, 650 February 15.00 Puts vs 15.70 trade 17, 500 February 16.25 Calls vs 15.74 trade 25, 500 February 16.50/15.00 Fences trade flat, 2,700 March 16.50 Calls vs 15.75 trade 28-29, 2,500 March 16.00 Calls vs 15.75 trade 45, 1,070 March 16.75/15.00 Fences trade 4, 1,000 March 16.25/17.50 Call Spreads vs 15.74 trade 25, 850 March 16.75/16.00 Put Spreads trade 54, 800 March 16.50/17.75 Call Spreads vs 15.75 trade 20 and 700 July 17.00 Calls vs 16.34 trade 54.

The Ukraine has produced1.5 million tonnes of sugar from domestically grown beets, a 90 % increase over last season at the same point. The Ag Ministry and producer’s union expect total production of 1.70 million tonnes, a 42 % increase over last year. Brazil’s government has called for a meeting with representatives of the ethanol production sector and theautomotive industry on Friday to discuss the increase in the percentage of anhydrous ethanol blended with gasoline from 25 % to 27.5 %, according to Kingsman’s Daily News Summary. The government is expected to present the results of technical studies showing the elevated mix will not cause increased risk for motor vehicles. The National Sugarcane Forum would like the high level of ethanol to be implemented by January 1st, but expectations are that the government will not act until April 2015. India’s food department has forecast the current crop at 25.0 million tonnes, above the 24.5 million tonnes forecast earlier this year. According to the Times of India, 56 cooperative and 41 private mills have started crushing in Maharashtra, although wet conditions have slowed cane cutting and transport to mills. Sugar output in the country is up 21 % year on year at 560,000 tonnes, compared to 462,000 tonnes at this stage a year earlier. According to the Indian Sugar Mills Association, stocks in the country total 7.5 million tonnes as of October 1st. Mills in Pakistan may delay the start of their crushing season, which should begin by the fourth week of November, due to surplus stocks of 1.5 million tonnes from last season and the government’s refusal to grant a subsidy for exports.

In the NAFTAregion: Light activity in the spot January between 24.05 and 24.00 accounted for all of the activity in the US futures market today. Prices settled 17 higher in January at 24.20, 18 higher in March and from eight higher to 20 lower in the back months. Some comments regarding the AD/CVD suspension agreements have been made public. Comments submitted on behalf of the American Sugar Coalition, the Plaintiffs in the case, stated in part, “for purposes of the Agreements, ‘refined sugar’ must be defined as sugar with a polarity of 99.50 and above, dry weight, pursuant to Chapter 17 Harmonized Tariff Schedule of the United States, 19 U.S.C. §1202 (hereinafter cited as ‘HTSUS’). All ‘other sugar’ must be defined as sugar with a polarity of less than 99.50 dry weight that is imported for further processing in a refinery. For this purpose, ‘further processing’ should be defined as ‘(1) performing those actions to further improve the quality of the sugar resulting in an enhancement of the dry weight polarimeter reading of not less than 0.15 degrees, and (2) performing all three of the following steps: (a) one or more of affination, defecation, or clarification, (b) filtration, and (c) further purification by one or more of adsorption, ion-exchange or crystallization.’” Additionally, ASC stated that “each importer of record in the United States should be required to certify to CBP that, to the best of the importer’s knowledge and belief, the price actually paid to the mill or mills that produced the sugar being entered was at or above the relevant Reference Price. In addition, each importer of “other sugar” should be required to provide to CBP in connection with each entry of “other sugar” a certification or certifications from refiners that the Sugar covered by that entry will be further processed in the United States.” Most importantly, to our eyes, ASC requested, “The Department should clarify in the final suspension agreement that the United States will prohibit entry of any Sugar from Mexico that issold at prices less than the reference price established in Appendix I of the Agreement. In so clarifying, the Department should explain that the 15 percent rule in paragraph two of the “Price Undercutting” section is a secondary requirement to the Reference Price. Simply put, the Reference Price is the price that governs on a transaction-by-transaction basis. In addition, the Department should define the basis for the Reference Prices to be F.O.B. mill U.S. dollars per pound at 96 degrees polarity, dry weight.” The full ASC comment can be found here: http://www.sugaralliance.org/wp-content/uploads/2014/11/2014-11-18-Petitioners-Suspension-Agreement-Comments.pdf

The Sweetener Users Association also offered significant comments. In part, the SUA requested, “In particular, the suspension agreements should not take effect until after the Department has issued final determinations in the antidumping and countervailing duty investigations and, assuming those determinations are affirmative, the United States International Trade Commission ("ITC") has issued a final affirmative injury determination.” SUA also stated “the Department should revise the definition of ‘refined sugar’ in the draft AD and CVD suspension agreements so that the definition is consistent with the prevailing industry definition that is also embodied in the HTSUS (i.e., a definition of refined sugar as having a polarimeter reading of 99.5 degrees or greater). The SUA’s full comment can be found here: http://sugarreform.org/wp-content/uploads/2014/11/SUA-Comments-re-Draft-Agreements.pdf

While it is not clear how willing the signatories in the case - DOC and the Government of Mexico – will be to adopt these and/or other changes to the suspension agreements, today was an important day in the ongoing process. It is increasingly clearthat the cane refining industry in the US as it currently exists will be drastically challenged if the suspension agreements are signed as initiallyproposed. As the comment presented on behalf of the ASC concluded, “Without these changes, the efficacy of the AD Agreement and its ability to ensure the continued vitality of the domestic sugar industry is substantially undermined, if not fully eviscerated.”


Jenkins Sugar Group, Inc.

This email address is being protected from spambots. You need JavaScript enabled to view it.


JSG Indications:







Raws: USNH:







Mexican peso to USD:



Raws: “Fair value” #16 futures pre-close, or JSG estimate.

This report has been compiled for general informational purposes only. While efforts have been made to ensure accuracy, Jenkins Sugar Group, Inc. assumes no responsibility for errors and omissions.


Contact Information

JSG Commodities

(203) 853 3000

16 South Main Street
Suite 202,
Norwalk, CT 06854

Frank Jenkins
This email address is being protected from spambots. You need JavaScript enabled to view it.
Ken Lorenze
This email address is being protected from spambots. You need JavaScript enabled to view it.
Jeff Dobrydney
This email address is being protected from spambots. You need JavaScript enabled to view it.
Eric Bergman
This email address is being protected from spambots. You need JavaScript enabled to view it.
Stephen Ward
This email address is being protected from spambots. You need JavaScript enabled to view it.
Chris Cody
This email address is being protected from spambots. You need JavaScript enabled to view it.
Diana Nguyen
This email address is being protected from spambots. You need JavaScript enabled to view it.