Author: Michael Ferrari, PhD
VP, Applied Technology & Research

While sugar futures are starting off the week with support, expect this to fade as a very active Indian Monsoon pattern will help the country’s sugar cane regions in the northern belt.  In addition, while delays are present in sugar exporting out of Brazil will occur, emotion has pushed the market higher than it should be (in the short term).  Looking beyond the next couple of sessions, we caution, however, that many analysts are looking at the revival of the moisture to accompany the short term pattern as a sign that all crop concerns are washed away.  The fact remains that for cane, growing regions in the north are still at a water deficit, and while improvement is expected, we still anticipate seasonal rainfall totals to fall short of what is needed to make the kind of crop numbers the market needs.  OCT: 18.60 range to slide back to 18.1-18.3, then as active precip patter retreats, increased support at 18.4+ levels.

WTI weekly y/y precip verification: