Sugar in the single digits – a welcome sight, given the current level of speculation in global ag commodities. Weather Trends’ clients will see that the breakdown of Brazil’s seasonal dryness is starting to occur, as our forecast had pointed to. And while it will still be drier than normal, the return of moisture to southern Sao Paulo, Parana, RGDS and Minas Gerais will be a welcome sign for growers concerned with next year’s crop. Sugar for March delivery finished trading last Friday at 10.14, with a brief dip below the 10 cent mark; this week has seen much of the week below 10 cents/lb. At the end of the day, in spite of all of the speculation, the global sugar supply situation is strong, so we enter 4Q07 with healthy global stocks and favorable weather for next year’s cane crop. While Brazil is getting most of the attention, we should take a quick look at Australian crop conditions. The Weather Trends outlook expects the Australian pattern to improve throughout the Queensland growing region. This is weather that will help next year’s crop. The return to a wetter pattern in November will help to recharge groundwater levels and improve soil moisture and overall crop health as we move towards 2008.

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