Sugar discussion

Gentlemen,

What do you think about the sugar prices? Isn't it a good moment for a short position and waiting for the drop to 20$ / 100pounds?

Herbarz

don't step in front of the train...wait for price action

I am shortmy target is 17,5, let see if it gets there. If it does, then it will go all the way to arround 14.

Sugar has a strong upside momentum with good pull backs. Buy the dips on momentum during the Euro Open of the SB-MH0 #11 and during U.S. Open. I would caution shorts unless you hold the trigger firmly. This is a top hungry beast due to the Fundamental Discord with India, China, and all other major production regions. SB-MV9 expires today!

It seems that the price can't deside if it will go up or down. The triangle is formed but it was breached a few times,the price was pulled back into it. What do you say about it?

More chop in sugar, I think.

I am commodities trader but use options in my portfolio to benefit from these kind of moves.
I have sold call spread which generated me a credit of $900 per contract (this is couple of months back)

Trade:

Sell Call @ Strike price 30
Buy Call @ Strike Price 35

Maximum risk is difference between calls.
Maximum profit is $900 per contract.
Combine this with buying a PUT @ strike price 22.

I achieve conservative return of 355 trading options of Commodites and FX
If anyne needs any more info, please PM Me.
Sahil

We are getting close to 30. Last peak was 30,31. Possible double top, and we are overbought. Last time it went from 30 all the way to 13. Anyone trading this one?

I trade sugar actively. I am currently long over the weekend with an average position in the high 26's. My price target is 31.52.

Oddly, sugar seems to have traded 50 contracts on Saturday (yesterday). Ending up .32 from its settle on Friday. Quite odd, and possibly a fault of buggy software.

I find it interesting that most of the calls in this thread have been to short sugar, and I believe many commodity traders share this perception with sugar. However, this perception is poorly conceived. The sugar #11 contract is raw sugar, as opposed to the refined sugar you can buy in a grocery store below market price. This is significant as sugar can be used to produce ethanol, and other products of significant value in the biofuel world. Corn prices are absurdly high now, and sugar is an incredible alternative. Because of the supposed correlation between refined and raw sugar, there is confusion amongst the trading world as to the fundamentals of sugar.

More frustrating still is the oddities of sugar exporters.

Brazil is the biggest exporter. Recently, the crop in Brazil has been in question, and they likely will not meet demand. The price of raw sugar in Brazil is supposedly in the 31's. Also, mills there are buying back their hedges as the consensus is that sugar #11 futures will move higher.

India is also a big player, but they release almost 0 information about their harvest, and refine much of the sugar in India, as opposed to using it for ethanol, like Brazil.

China has a reserve of sugar, they have supposedly started selling this reserve to meet demand this year. Refined sugar on Chinese exchanges sells in the 950's compared that to the closing price of 706.90 in London.

Russia imports sugar to refine, however, import taxes are a hefty 50%, and it is currently not profitable in this market. Despite a refined sugar price similar to China's.

Thailand, also a large producer is producing less this year.

India is the wildcard.

Some resources for sugar trades!

http://www.sugaronline.com/home

http://www.agrimoney.com/news/sugar-...ent--2389.html

http://www.agrimoney.com/news/sugar-...lls--2351.html

agrimoney.com in general

Sugar is my favorite commodity to trade, but the market is not widely watched, and there is generally little news. I have considered making an in depth website about the market, but have thus far refrained as I believe it is too niche.

Feel free to ask me questions or opinions on the market.

p.s. Lets bring this thread back!

Crazy day for sugar! Was much like the video, hahaha.

Could be an interesting day tomorrow in the sugar market, not only QE2 coming up, but potential weather issues in India.

http://www.bloomberg.com/news/2010-1...ster-says.html

Great Post! I thinking about trading with sugar! at least starting with demo. Thank you!

It is sad to say that the sugar margin has increased so rapidly that now it requires an account of 20k+ to trade it well intraday (with two contracts). This is a total bummer. When I first started trading sugar margin requirements were $1500, now it's $5,460. Cocoa is where it is at for smaller accounts. Still, sugar has some AWESOME moves intraday.

Stronger dollar leaves soft markets playing defense in thin trading ahead of holiday.
Cotton and coffee down and under pressure, sugar following along. Cocoa a little lower thus far.
Can't say I'm excited about any of the soft markets as they all are reacting to the macro environment.

I know that this is an old post but are you really sure about that?

I am regular trader of soft Commodities via options. This is a very good time to sell calls in sugar at around 30-40% on top of current market price. Also u can buy put 10% under the current future price to maximise the profit.

The fundamental price is in the region of 19-25

SJ

Although I am confident selling calls would be an effective strategy at this time, your fundamental price is very off. Market price in Brazil is closer to 30, and the market is very tight. I think there are better trades out there. How did you come up with that fundamental price? at the grocery store?

Clearly I was right to be skeptical, it seems you know little about the seasonality of sugar, this position must be underwater.

I trade in physical sugar as well in very large volumes and Brazil is not the only one producer. Last year price was up because of India.
I still think 20-25 is the fundamental price.