MORNING SUGAR REPORT

Tuesday July 28, 2020

WORLD SUGAR #11

World sugar futures have been unable to make new highs for the move this morning and are now trading lower on the day. October is now 11 lower at 12.02, as of 10:00AM EST, trading from 12.27 to 11.95 while March is last 10 lower at 12.62. More than 50,000 lots have traded between October and March to this point, surpassing any total the market saw last week. On spread, the October/March has traded from 59 to 64 under and last at 64 points discount. The March/May has traded from 28 to 20 over and last at 21 points premium.

SUGAR #11 OPEN INTEREST:  V0: 385,337 +4,120  H1: 236,564 +4,446  K1: 98,352 +2,327
TOTAL: 965,975

SUGAR #11 OPTION WATCH

ATM VOLS: u 12.25 straddle 66-70 vol 28.60 unch v 12.25 straddle 99-102 vol 27.57 -.40% f 12.75 straddle 152-156 vol 24.20 -.10% h 12.75 straddle 182-189 vol 24.20 -.20% k 12.50 straddle 187-195 vol 22.30 -.20%

TRADES OF NOTE: 2,000 U 12.75 CALLS TRADE 12-17 (PAPER BUYS) 600 V 12.50 CALLS VS 12.24 TRADES 38 (PAPER SELLS) 700 H 11.75 PUTS VS 12.76 TRADES 47 (PAPER SELLS)

LONDON #5

In London, October is last $1.60 lower at trading from $369.00 to $360.80 to this point. On spread the October/December is last MACRO BYTE Senate Republicans rolled out a roughly $1.0 trillion coronavirus relief bill proposal Monday, launching a mad dash to reach a deal with Democrats on expiring unemployment payments and other aid disputes in the parties’ rival plans. The Republican plan cuts the current federal $600 weekly unemployment supplement to $200 a week through September, when the payment will then combine with state benefits to replace 70.0% of previous wages. Democrats have proposed continuing through January the current $600-a-week supplement, which costs about $15.0 billion a week. Brazil recorded a current-account surplus of $2.20 billion in June, from a surplus of $1.30 billion in May, the country’s central bank said Tuesday. The 12-month current account deficit reached $38.20 billion in June from a revised $43.10 billion the month before. $0.50 lower at $3.80 premium. The October/October is last $97.50, unchanged on the day.

GLOBAL FUNDAMENTALS

Cash-wise: The JOB Economia Index for sugar in 50kg bags in Sao Paulo is down 0.2% the week at $253.00 per tonne (11.47), through July 24th. The price equivalent for hydrous ethanol with raw exports FOB now valued around 10.00, which is up 3.0% on the week and slightly lower compared to where prices were this time a year earlier (chart below). Anhydrous ethanol prices are valued around 10.60, up 3.1% on the week.

Brazilian sugar exports may close July at around 3.35 million metric tonnes, close to the monthly record of 3.5 million metric tonnes reached in September 2017. Brazil has already exported 2.63 million metric of sugar in July, a volume higher than the total of 1.82 million metric tonnes shipped in the same month of 2019, informed the Secretariat of Foreign Trade (Secex).

The beet tests conducted so far suggest that Russia's sugar output will fall to 5.7-6 million metric tonnes next year, down 19-23% on year, according to Soyuzrossakhar. Nonetheless, stocks will reach a record 3.1 million mt by August 1st, while exports will be key to balance the market, it added.

GLOBAL CURRENCY UPDATE  USD: 93.635 +0.02%  BRL: 5.1875 -0.81%  INR: 74.848 +0.09%  MXN: 22.061 +1.01%

Best Regards,
Jeff Dobrydney
Senior Vice President
Head of Futures & Options
JSG Commodities
This email address is being protected from spambots. You need JavaScript enabled to view it.
203.853.3000
www.jsgcom.com

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

Contact Information

JSG Commodities

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Frank Jenkins
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