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(SB) MONTHLY STRATAGEM…
…
SUGAR
UP ON SUPPLY & A SWEET TOOTH
BACKGROUND
LOGIC:
The 4th quarter is a critical time in the development of
the world’s sugar supply. European
and American sugar beet producers are harvesting, while Brazilian, Asian
and other Southern Hemisphere producers are entering canes
planting/harvest effort.
During the Planting/Harvest effort, especially, the sugarcane crop is at
risk. Future supply is
uncertain, and therefore prices tend to be supported.
Couple supply concerns with increasing demand as holidays across
the globe are celebrated with sticky, sugary sweets.
This play of strong demand and uncertain supply tends to be
supportive of prices.
MARCH
SUGAR#11 HISTORICAL PERFORMANCE
% AND CENTS/LB CHANGES
|
OCT
|
NOV/DEC
|
NOV/DEC
|
DEC
|
OCT-DEC CHG
|
NOV/DEC RALLY
|
NOV/DEC BREAK
|
|
YEAR
|
CLOSE
|
HIGH
|
LOW
|
CLOSE
|
CENTS/LB
|
%
|
CENTS/LB
|
%
|
CENTS/LB
|
%
|
|
1983
|
9.36
|
10.10
|
7.99
|
8.18
|
-1.18
|
-12.6%
|
0.74
|
7.9%
|
-1.37
|
-14.6%
|
|
1984
|
5.83
|
6.05
|
4.02
|
4.19
|
-1.64
|
-28.1%
|
0.22
|
3.8%
|
-1.81
|
-31.0%
|
|
1985
|
6.14
|
6.56
|
5.38
|
5.62
|
-0.52
|
-8.5%
|
0.42
|
6.8%
|
-0.76
|
-12.4%
|
|
1986
|
6.90
|
7.30
|
5.99
|
6.16
|
-0.74
|
-10.7%
|
0.40
|
5.8%
|
-0.91
|
-13.2%
|
|
1987
|
7.59
|
9.55
|
7.31
|
9.49
|
1.90
|
25.0%
|
1.96
|
25.8%
|
-0.28
|
-3.7%
|
|
1988
|
10.59
|
12.00
|
9.91
|
11.15
|
0.56
|
5.3%
|
1.41
|
13.3%
|
-0.68
|
-6.4%
|
|
1989
|
13.97
|
15.38
|
12.78
|
13.16
|
-0.81
|
-5.8%
|
1.41
|
10.1%
|
-1.19
|
-8.5%
|
|
1990
|
9.42
|
10.33
|
9.33
|
9.37
|
-0.05
|
-0.5%
|
0.91
|
9.7%
|
-0.09
|
-1.0%
|
|
1991
|
8.98
|
9.27
|
8.12
|
9.00
|
0.02
|
0.2%
|
0.29
|
3.2%
|
-0.86
|
-9.6%
|
|
1992
|
8.77
|
9.00
|
8.12
|
8.39
|
-0.38
|
-4.3%
|
0.23
|
2.6%
|
-0.65
|
-7.4%
|
|
1993
|
10.62
|
11.03
|
9.88
|
10.77
|
0.15
|
1.4%
|
0.41
|
3.9%
|
-0.74
|
-7.0%
|
|
1994
|
12.80
|
15.38
|
12.73
|
15.17
|
2.37
|
18.5%
|
2.58
|
20.2%
|
-0.07
|
-0.5%
|
|
1995
|
10.56
|
11.65
|
10.52
|
11.60
|
1.04
|
9.8%
|
1.09
|
10.3%
|
-0.04
|
-0.4%
|
|
1996
|
10.30
|
11.00
|
10.21
|
10.99
|
0.69
|
6.7%
|
0.70
|
6.8%
|
-0.09
|
-0.9%
|
|
1997
|
12.39
|
12.55
|
11.86
|
12.22
|
-0.17
|
-1.4%
|
0.16
|
1.3%
|
-0.53
|
-4.3%
|
|
1998
|
7.71
|
8.50
|
7.42
|
7.86
|
0.15
|
1.9%
|
0.79
|
10.2%
|
-0.29
|
-3.8%
|
|
1999
|
6.88
|
7.10
|
5.62
|
6.12
|
-0.76
|
-11.0%
|
0.22
|
3.2%
|
-1.26
|
-18.3%
|
|
2000
|
9.90
|
10.33
|
8.67
|
10.20
|
0.30
|
3.0%
|
0.43
|
4.3%
|
-1.23
|
-12.4%
|
|
2001
|
6.74
|
7.85
|
6.61
|
7.39
|
0.65
|
9.6%
|
1.11
|
16.5%
|
-0.13
|
-1.9%
|
|
2002
|
7.36
|
7.89
|
6.58
|
7.61
|
0.25
|
3.4%
|
0.53
|
7.2%
|
-0.78
|
-10.6%
|
|
2003
|
5.93
|
6.79
|
5.66
|
5.67
|
-0.26
|
-4.4%
|
0.86
|
14.5%
|
-0.27
|
-4.6%
|
|
2004
|
8.60
|
9.08
|
8.35
|
9.04
|
0.44
|
5.1%
|
0.48
|
5.6%
|
-0.25
|
-2.9%
|
|
2005
|
11.33
|
14.89
|
11.13
|
14.68
|
3.35
|
29.6%
|
3.56
|
31.4%
|
-0.20
|
-1.8%
|
|
2006
|
11.55
|
12.57
|
11.15
|
11.75
|
0.20
|
1.7%
|
1.02
|
8.8%
|
-0.40
|
-3.5%
|
|
2007
|
9.98
|
11.19
|
9.63
|
10.82
|
0.84
|
8.4%
|
1.21
|
12.1%
|
-0.35
|
-3.5%
|
|
LAST 25 YEARS
|
|
#UP
|
|
15
|
|
|
|
|
|
|
|
|
#DOWN
|
|
10
|
|
|
|
|
|
|
|
|
AVERAGE
|
|
0.26
|
1.7%
|
0.93
|
9.8%
|
-0.61
|
-7.4%
|
|
LAST 15 YEARS
|
|
#UP
|
|
12
|
|
|
|
|
|
|
|
|
#DOWN
|
|
3
|
|
|
|
|
|
|
|
|
AVERAGE
|
|
0.62
|
5.5%
|
1.01
|
10.4%
|
-0.44
|
-5.1%
|
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
PLEASE REFER TO THE HYPOTHETICAL DISCLAIMER AT THE BEGINNING OF
THIS TEXT FOR FURTHER DETAILS, LIMITATIONS, AND DETAILS ASSOCIATED WITH
USING THE ABOVE INFORMATION. RALLY
REFERS TO THE DIFFERENCE BETWEEN THE OCTOBER CLOSE AND THE
NOVEMBER/DECEMBER HIGHEST PRICE WHILE BREAK REFERS TO THE DIFFERENCE
BETWEEN THE OCTOBER CLOSE AND THE NOVEMBER/DECEMBER LOWEST PRICE.
SUMMARY:
Though Sugar futures have only rallied in 15 of the
last 25 years during November and December, its performance in the last
decade and half is much more impressive.
Since 1993, March Sugar futures have increased during
November/December 12 times (80.0%), producing an average October through
December change of +0.62 cents/lb (5.5%).
The average November/December Rally of 1.01 cents/lb (+10.4%)
dwarfs the average November/December Break of -0.44 cents/lb (-5.1%),
clearly showing the strength of this move.
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