Sugar futures have climbed nearly .02 cents a pound since the latter part of September amid India’s first two-year drought in three decades – thanks to El Nino’s disruption of the normal monsoon season there. Sugar futures are up 38 points today currently trading at .1326 cents per pound at the Intercontinental Exchange.
Brazil and India are the world’s top producers of sugar and data from India’s meteorology department reported rains during the June through September monsoon season were only 86% of their normal level – qualifying it as an official drought for the second year. Sugar production in another region in the country is reportedly seen down 14% from last season.
Devin Brady, President of Progressive Trading Group in Sherman Oaks, CA, shares his view regarding the fundamental situation of the sugar futures markets by stating, “Sugar plantings (in India) may be limited because of the unusual weather happening there.” Brady added, “The dry weather can easily be perceived as a ‘bad investment’ for sugar farmer’s new plantings.”
The technical trend for sugar futures has been up since mid-September, but has only broken out to the upside this week. I am looking for some kind of pull-back in sugar futures before committing to the long-side of this market.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
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