MORNING SUGAR REPORT

Friday January 8, 2021

WORLD SUGAR #11 World sugar futures began the session stronger, in modest volume, March is last 23 lower at 16.02, trading from 16.33 down to 15.87 as of 11:00am EST. May is last nine lower at 15.15. Fewer than 25,000 lots have traded between March and May. On spread, the March/May has traded from 90 to 81 over and last at 82 points premium. The May/July has traded from 55 to 47 over and last at 47 points premium.

SUGAR #11 OPEN INTEREST:  H1: 402,412 -3,159  K1: 210,114 +932  N1: 153,750 +2,792 TOTAL: 1,091,938

SUGAR #11 OPTION WATCH Paper continues the rolling of v 14.00 calls through selling of the v 14/15 cs , 4,200 have trade live @ 35. Two day total is over 9,000.

ATM VOLS: g 15.75 straddle 65-68 vol 35.90 -.50% h 15.75 straddle 131-134 vol 32.00 +.50% k 15.00 straddle 180-184 vol 29.55 +.80% n 14.25 straddle 199-202 vol 26.60 +.60% v 14.25 straddle 233-237 vol 25.00 +.60%

LONDON #5

In London, the March is $1.20 higher at $434.10, trading from $438.20 down to $433.70 to this point. On spread, the March/May has traded from $14.10 premium down to $12.70 over and last at $13.10 premium. The March/March white premium is last at $90.00, unchanged on the day.

MACRO BYTE Goldman Sachs Group Inc.’s commodities traders doubled their revenue haul in 2020 -- another sign that Wall Street desks managed to print profits into the year’s finale, even as market mayhem subsided. Goldman’s business generated more than $2 billion in revenue for its best annual showing in about a decade, according to people with knowledge of the matter. That was a much needed redemption: The unit’s prowess once earned the bank the nickname “Wall Street Refiner,” but a prolonged slump in recent years was starting to raise doubts about the group’s future. The strong finish also bodes well for rivals ahead of earnings reports that will cap one of the most lucrative trading environments in banking history. Already, Jefferies Financial Group Inc., a bellwether for Wall Street, disclosed a 67% jump in net revenue for its fiscal year ending in November, raising the prospects of similar performances elsewhere.

GLOBAL FUNDAMENTALS

Cash-wise: Today’s CFTC Commitment of Traders report incorporates a period where March traded from 14.98 up to 16.15 during the shortened reporting week. We believe that the supplemental spec position has gone from a 209,828-lot long to a long position of around 233,250 lots. March open interest has gone from 385,996 to 407,403 lots. May open interest has gone from 209,680 to 210,093. Total open interest has gone from 1,052,268 to 1,089,003.

EU sugar exports should be capped at 750,000mt in 2020/21 (Oct-Sep), from 1.09 million mt in 2019/20, which itself was a 40% drop on year, according to APIC Consulting. October exports were already down 30% on year at 93,000mt. The collapse in the 2020/21  EU output and world prices below both contracted and spot prices in the bloc are some of the main reasons for the anticipated drop in 2020/21 exports.

Thailand’s average daily crush pace in December was down 38% on the year as mills have to deal with more unburned cane following new government policies, sources said. The Thai Hi-Pol raw sugar premium over NY for January has reached 182 points as a result, S&P Global estimated.

The Mexican cane harvest was a bit behind plan but still well ahead of last year’s progress in the week ended January 2nd. In the 14th week of the campaign 213,266 tonnes of sugar were produced, 3.9 % below the official plan for the crop but 31.9 % ahead of last year. For the crop to date, 1.066 million tonnes of sugar have been produced compared to 1.139 million tonnes as per the plan and 744,455 tonnes produced last year. The official plan for the crop calls for total production of 6.140 million tonnes. Interestingly, the current crop is keeping pace with the FY’19 crop through week 14 – that crop produced 6.426 million tonnes.

GLOBAL CURRENCY UPDATE  USD: 89.741 -0.22%  BRL: 5.3394 +1.14%  INR: 73.245 +0.13%  MXN: 19.908 +0.21%

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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Ken Lorenze
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Jeff Dobrydney
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