Policy regulation may limit the price of sugar

Affected by the weakness of the US dollar and the market's concern that bad weather will lead to the supply of Brazil can not meet the market demand, this Monday (August 18) ICE sugar raw sugar futures prices soared more than half cents / pound. The main 03 contract eventually settled at 27.58 cents/lb, with an increase of 55 points throughout the day. In addition, the sugar futures market in London's sugar market this week was relatively weak. However, the relatively tight supply and demand pattern of sugar in the world still supported the sugar market. On the day of 1012, the approximate price of sugar fell by US$0.90/ton to the highest point of US$695.30/ton. In the 1103 period, the price of sugar also fell by US$0.20/ton to US$682.40/ton. Zheng sugar opened lower in the morning on the 19th, hitting the previous day's highs and turning back to start a wide range of volatility.

In international market news, Michael McDaughel, senior vice president of NewEdge, New York, said that the sugar producers in Brazil, the world's number one sugar producing country, seem to have little interest in selling sugar. Although the sugar price plummeted on October 15 and ended Liu Lianyang, if Brazil continues to reluctantly sell, the price of sugar is unlikely to fall. Moreover, the sugar market is still supported by demand from the spot market. The drought in Brazil this year has caused the market to worry that its production cannot meet market demand. At present, some Brazilian sugar producers are somewhat reluctant to sell. The current market is still tracking daily weather changes in Brazil in order to predict how much the Brazilian weather changes will have a negative impact on global sugar supply. Ratzeburg, Germany F. O. Licht's analysts said that due to factors such as drought and the aging of sugarcane, it is estimated that Brazil's production will decline next year. In addition, Shree Renuka Sugar Company, the number one refiner in India, said last week that due to the prolonged increase in rainy season this year, the sugar production of India during the 10-11 sugar production period will exceed the expectations of the ISMA. The 25.5 million tons reached 26 million tons.

In terms of domestic stocks, the National Development and Reform Commission, the Ministry of Commerce, and the Ministry of Finance decided to arrange the national reserve of sugar in batches. On October 22, the first batch of 210,000 tons in the crop season was placed on the market, and the number was increased according to the circumstances. Analysts pointed out that the country's first release of sugar reserves on the first batch of new crop, coupled with the recent listing of new sugar, indicating that domestic resources are sufficient, it is expected that the short-term upward trend in sugar will be suppressed.

Analysts believe that from the global perspective, the current pattern of supply and demand is still positive, and the situation of tight spot prices in various countries has not been effectively improved. However, Brazil's shipping speed still cannot meet the demand for sugar in the international market. Long-term sugar prices will remain at high levels. However, the short-term Zheng sugar soaring market may be subject to short-term adjustments due to pressure from policy dumping and the listing of new sugar, and wide shocks will intensify, but it is not ruled out that there may still be new heights in the later period.