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There are two types of
Sugar grown in the world: Beat and Cane. In its finished and refined form,
both are indistinguishable. But, by risk to crop the two are very
different.
Cane sugar is grown in
moderate climates, with the biggest risk occurring at harvest, as insects
have sweet toothes as well as people. Beat sugar however is more
susceptible to frost and drought than cane Sugar due to the climates it is
grown in. As such, the risk to crops is centered around specific times of
the year, most notably late spring and end of year.
* Past performance is not
necessarily indicative of future results. See disclaimer on Page 2 for
further details.
During much of the
year, the Sugar market tends to go generally sideways, driven by major
supply and demand trends. However, in the late spring/early summer
(May/June) future supply becomes much more uncertain.
The above mentioned
period is when Sugar cane in many locals is harvested and Sugar beets are
planted. Both of these stages are wrought with potential hazards, ranging
from insects to weather. As such, future supply is uncertain and prices
tend to rally to compensate.
The end of year period
from October to December is another period of rising prices, but this is
mainly demand driven. The beet crop is freshly harvested, but processing
often lags demand. Demand tends to be strong with the Holiday season and as
such consumers must pay up for available supply until harvested supply is
processed for use.
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