The rally that started at the end of last week extended into Monday’s trading; March09 ICE sugar futures put in a strong performance crossing the 12.9 mark, and early activity on Tuesday has already exceeded 13 cents. Trading is above the 50d moving average, and technical signals are neutral to bearish in the short term; fundamentally, prices are still justified at this level however, and any scaling back into the low to mid 12 cent range appears to be a favorable entry point. The market has been discussing recent dryness in Brazil’s Centre-South growing region (more of a negative impact to beans at this stage). The short-range outlook is expecting some moisture to make its way into Sao Paulo and Parana over the next few days (see WTI forecast below), and this will be a benefit to recent plantings for the following crop year, which are currently approximately 2/3 complete. Our extended view through March, however, is not as favorable.

This entry was posted on Tuesday, February 3rd, 2009 at 11:47 am and is filed under Agriculture, Global Commodities, Global Weather, Softs, Sugar. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.