MORNING SUGAR REPORT

Thursday January 6, 2022

World sugar futures have sagged a bit lower again in moderate volume. March #11 is last eight lower at 18.26 as of 10:45 AM EST, trading from 18.39 down to 18.23. This is the lowest March has traded since August 5, 2021. May is last 10 lower at 18.00, trading from 18.14 to 17.99. More than 30,000 lots have traded between March and May to this point. On spread, the March/May has traded from 22 to 27 over and last at 26 points premium. The May/July has traded from 14 to 10 over and last at 12 points premium.

SUGAR #11 OPEN INTEREST:  H2: 342,666 +5,971  K2: 154,012 -701  N2: 120,522 +3,437 TOTAL: 884,075 SUGAR #11 OPTION WATCH

ATM Vols. g 18.25 straddle 50-54 vol 18.90 -1.1% h 18.25 straddle 106-109 vol 22.10 -.10% k 18.00 straddle 165-168 vol 21.80 +.05% n 18.00 straddle 206-211 vol 22.00 unch March 19.00 calls has been active: 750 h 19.00 calls vs 18.31 trade 31 750 h 19.00 calls live trade 31

LONDON #5

In London, March is last 0.60 lower at 487.60, trading from 490.50 down to 486.60 to this point. On spread, the March/May is last 0.60 higher at 5.70 premium. The March/March white premium is last 85.00, up 2.00 on the day.

MACRO BYTE

Goldman Sachs Group Inc. is “extremely bullish” on commodities, amid a supercycle that has the potential to last for a decade, according to Jeff Currie, the bank’s global head of commodities research. The new year has started against a backdrop that includes record dislocations in energy, metals and agriculture, and significant amounts of money in the system, Currie said in a Bloomberg Television interview. In addition, investment positions in commodities are low, he added. “The best place to be right now, particularly given the Fed pivot, are commodities,” Currie said, referring to the U.S. Federal Reserve’s decision to begin hiking interest rates later this year. “We think you’re going to see another year of out-performance of commodities and real assets more broadly.”

GLOBAL FUNDAMENTALS

Cash-wise: According to Williams SA the Brazilian vessel line-up of raw sugar waiting to load is now 679,074 tonnes of sugar, which is slightly lower on the week. This compares with 723,138 tonnes last week and 858,959 tonnes last year. Approximately 100,000 tonnes of sugar shipped on the week. Please see our attached chart.

Here are the new named nominations: ALGERIA 45,000 MACEIO NOLIS BLACK SEA 42,500 MACEIO NOM UK TOTAL: 87,500

According to Tropical Research, the forecast for Indian sugar production in this current crop has been elevated to 31.7 million tonnes, up from 31.4 million tonnes – which would be 500,000 tonnes higher year on year, as the pace of crushing continues well in front of a year ago. There have been higher than forecast yields in both Maharashtra and Karnataka.

Thailand sugar mills have crushed 17.7M MT of sugarcane compared to 10.7M MT of sugarcane crushed at the same time last season.

Currently, comparing the China domestic sugar futures prices and the ICE US New York #11 March 2022 futures price, the import arbitrage for Out-of-Quota (“OOQ”) sugar for sugar originating in Brazil is just a bit negative, while it is positive for sugar originating from Thailand, and India. This was reported by Tropical Research.

GLOBAL CURRENCY UPDATE  USD: 95.936 -0.65%  BRL: 5.6629 +0.47%  INR: 74.260 +0.43%  MXN: 21.617 -0.61%

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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