2023-09-29 19:18:34
A record quantity of sugar was delivered at the expiration of the October contract on the ICE exchange, estimated at 56,470 lots or approximately 2.87 million metric tons, according to preliminary information from three traders on Friday.
Chinese trader COFCO International is said to be the largest sugar deliverer with 22,588 lots, or about 1.15 million tons, followed by Louis Dreyfus Co. with 14,398 lots, or about 732,000 tons.
Asian trader Wilmar was considered the largest recipient with 54,311 lots, or around 2.76 million tonnes.
ICE will release official expiration data on Monday.
Large physical deliveries during the expiration of futures contracts are generally seen as a bearish signal to the market, as the dealers delivering the commodity may not have benefited from better conditions to sell the commodity. produced outside the stock market.
The October raw sugar contract closed 1.7% lower on Friday.
One of the traders, however, said that Wilmar, the Asian commodities trader that takes most of the sugar, has a “full destination book” and might as well send some of it to its refineries.
“The last time we had a record delivery, the market recovered,” he said.
The sugar market has been well supported by production difficulties in Asia, and recently reached its highest level in 12 years.
“A lot will depend on how the situation in India and Thailand develops over the next two months,” the trader said.
Sugar analyst Claudiu Covrig expects Brazilian ports, where most sugar is expected to be delivered, to be even busier.
“Now imagine the queues in Brazil. There will be huge queues,” he said.
He thinks funds and speculators could push the market higher after December, when Brazilian stocks are expected to fall. (Reporting by Marcelo Teixeira, Editing by Chris Reese and David Gregorio)
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