Update as at 20 November 2019
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2019 Season Pool Prices (Pool valuation as at 14 Nov 2019)
Forward Season Pool Prices (Pool valuation as at 14 Nov 2019)
Net AUD/T (IPS) subject to change with changes in the ICE 11 market price affecting unpriced exposures, movement in the AUD/USD exchange rate and also due to movements in the Shared Pool.
- Sugar has traded within its familiar 12-13 cent range for the past number of weeks unable to sustain momentum higher despite a number of events improving the outlook for a global supply deficit this coming year:
- Earlier in November the Indian Sugar Millers Association (ISMA) revised down their forecast for the Indian crop. In July 2019 ISMA forecast this crop would produce 28.2 million metric tonnes of sugar based on satellite imagery of sugar cane growing areas. A second set of satellite images has seen that number revised down to 26.8 mmt. The crop has been impacted by drought and flooding in the second and third biggest producing states Maharastra and Karnataka.
- India has contracted for the export of approx. 1 million tonnes of sugar since the start of the new marketing year – 1st October 2019. This comes as the new harvest gathers steam and stocks hover around 14 million tonnes. These exports have been a 50/50 mix of white and raw sugar and destined primarily for the likes of Iran and other Asian countries Sri Lanka and Bangladesh.
- Thailand will commence harvest in the 2nd week of December, two weeks later than normal as the industry there estimates the crop will be down from 133 million tonnes of cane last season to perhaps 110 million tonnes this year on the back of a poor growing season.
- The US has produced less sugar than usual this year following poor beet growing conditions. Last year’s production was 9.2 million tonnes of sugar, this year 8.6m. Prior to the implementation of the North America Free Trade Agreement this situation would have likely seen an increase of Tariff-Rate Quota (sugar imports from the likes of Aus). However, Mexico will now be given greater access to the US market to fill the void, assuming it has the supplies to do so.
- Brazil’s currency traded to a 4 year low of 4.2182 on the 19th of November. The Aussie dollar is today trading around 0.6828.