Tuesday April 23, 2024

World sugar futures settled 11 higher in May at 19.91, five higher in July at 19.66 and from three lower to six higher in the back months. Outright traded volume was 106,815 lots. On spread, May/July traded from 17 to 26 over and last at 23 over. The spread saw 18,909 lots trade today. OI stood at 84,232 lots as of this morning. There were 9,861 lots of May EFP’s and 6,326 lots of May EFS’s posted today. Five trading days remain for the May. July/October traded from eight under to three under and last at three under. WTI Crude made a new low for the current move at $80.88 before moving back above $83.00. The Brazilian real improved to 5.1219 to the dollar today but remains in the middle of the past two weeks’ range. After seeing record highs on Friday, London Cocoa dropped by over 8.0 % today – the largest fall percentage-wise seen since April of 2009. The New York market dropped by 7.7 % today at the extreme.
Option watch: Sugar option volume a modest 7,064 contracts consisting of 5,278 Calls and 1,786 Puts. Volatility in the short-dated options was lower and the remainder of the board was unchanged. Trades of note: 500 July 20.00/22.00 Call Spreads vs 19.67 trade 47 (paper sells), 1,750 October 22.00 Calls trade 47-49 (paper buys) and 500 October 23.50 Calls trade 26 (paper buys).
ATM Vol’s:
June 19.75 Straddle 100 - vol 25.30, -1.7 %
July 19.75 Straddle 156 - vol 25.33, -.80 %
October 19.75 Straddle 238 - vol 23.90, -.40 %
March 20.00 Straddle 298 - vol 23.65, unchanged
Option Open Interest: Calls 315,799 +2,461, Puts 217,853 +2,125 - total 533,652 +4,586
Indian sugar production, following diversion to ethanol, is forecast at 28.5 million tonnes for 2024/25, according to S&P Global Commodity Insights, with of course a massive focus on the health of the June-September monsoon, which is currently expected to be much better than average. According to the USDA attaché in Guangzhou ATO, China’s 2024/25 sugar production is forecast at 10.4 million tonnes as the planted areas for both cane and beet are expected to rise. Given sugar prices are expected to trend down, China’s 2024/25 sugar consumption estimate is also forecast to increase to 15.7 million tonnes. The estimate for China’s MY 2023/24 sugar production is revised downward to 9.9 million tonnes due to low sugar content in cane grown in Guangxi. The full report can be viewed here.
In the USMCA region: US futures were not traded today. Prices settled unchanged with July at 38.95. New service reports indicate that officials in Baltimore plan to open a deeper channel for commercial ships to access the city’s port starting on Thursday, marking a significant step toward reopening the major maritime shipping hub that has remained closed to most traffic since the Francis Scott Key Bridge collapsed last month. The new channel will have a controlling depth of 35 feet (10.7 meters), which is a substantial increase over the three other temporary channels established in recent weeks. Starting early next week, the channel will be closed again until roughly
May 10 to accommodate “critical and highly dynamic salvage operations,” port officials said in a news release Monday. The port’s main channel, with a controlling depth of 50 feet (15.2 meters), is set to reopen next month. That will essentially restore marine traffic to normal.
Regards,
JSG Commodities
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(203) 853 3000
JSG Indications:
Q2'24
Q3'24
Q4'24
Q1'25
Q2'25
Q3’25
Q4’25
Raws:
38.25
38.50
38.25
38.50
38.50
38.50
38.50
Mexican peso:
17.1317
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.