Thursday December 23, 2021

World sugar futures settled two lower in March at 19.24, five higher in May and from 13 to five higher in the back months following a quiet session – outright traded volume was just 47,930 lots. On spread, March/May traded from 46 to 35 over and last at 38 over. May/July traded from 36 to 27 over and last at 28 over. WTI Crude was again firm today, rallying to $73.87. Technically, March left a double top today in matching Wednesday’s 19.38 high. For what its worth, the bottom of the old channel/lower edge of the overhead congestion is at 19.56. On its last foray into this territory, the rally for the March futures stalled at 19.90 before checking back to 18.52.

Option watch: Option volume was 7,022 contracts consisting of 4,327 Calls and 2,695 Puts. Volatility was lower across the board on a subdued pre-holiday volume session. Trades of note: 1,294 March 20.25/17.50 Fences vs 19.26 trade 31, 600 March 20.00 Calls trade 45-47, 250 March 20.00 Calls vs 19.15 trade 13, 300 July 18.00 Puts vs 18.55 trade 86, 300 October 19.75 Calls vs 18.35 trade 92, 250 October 18.50/16.00 Fences vs 18.43 trade 101 and 515 March’23 18.50 Calls vs 18.29 trade 151-153.

ATM Vol’s: February 19.25 Straddle 89-92 - vol 21.80, -1.0 % March 19.25 Straddle 143-146 - vol 24.35, -.65 % May 18.75 Straddle 196-201 - vol 23.25, -.30 % July 18.50 Straddle 229-235 - vol 22.75, -.25 %

Option Open Interest: Calls 343,228 +470, Puts 238,617 +215 - total 581,845 +685

Brazilian center-south hydrous ethanol sales in November dropped by 37 % compared to last year to 1.07 million cum in November, 46 % below pre-pandemic levels, ANP data showed. This is the sixth month in a row that hydrous sales have fallen. Demand from distributors is picking up, however, as the hydrous parity in Sao Paulo is coming close to 70 % again, according to Cepea/Esalq. As of December 20th , Thailand’s sugar mills have crushed 7.4 million metric tonnes of sugarcane compared to 3.8 million tonnes last year. The current daily rate of sugarcane crush is 880,000 tonnes, as compared to 500,000 tonnes a week ago.

In the USMCA region: US futures trading was quiet today. Prices settled five lower in March at 36.20 and 11 to 12 lower in the back months. Volume was confined to 12 lots of May that traded at 36.49 – one lot for each day of Christmas? Mexican sugar production in the week ended December 18 th totaled 206,006 tonnes from 2.047 million tonnes of cane, compared to last year’s 206,090 tonnes of sugar from 2.017 million tonnes of cane. For the crop to date, 614,507 tonnes of sugar have been produced from 6.448 million tonnes of cane versus 642,383 tonnes of sugar from 6.672 million tonnes of cane last season. Combined agro-industrial yield for the crop to date is 7.74 tonnes of sugar per hectare – matching last year’s combined yield. Production of sugar with pol below 99.2 degrees, for export to the US under the Suspension Agreements, stands at 110,137 tonnes versus 64,644 tonnes last year.


Regards,

JSG Commodities
This email address is being protected from spambots. You need JavaScript enabled to view it. (203) 853 3000 JSG Indications: Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Raws: 37.00 36.50 36.60 36.75 36.25 33.30 Mexican peso: 20.6382 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.

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