SUGAR REPORT | 24.03.2020 | SUGAR

The sugar market adopted a stronger tone on Monday, based on the possibilities of Corona induced delays the start of the crop in Brazil. While much has been written about meaningful Brazilian supply increases expected in response to global reductions in energy demand, combined with higher energy output, much of the extra sugar supply from C/S Brazil is expected to be felt further down the board. While no such restrictions are appearing at the Santos port thus far, there are regional government considerations being made to restrict workers and the movement of labor from mill to mill, that is an instrumental aspect of early production. Given that Santos sugar is the only available origin expected for the May tape anywhere near current levels, the ‘risk’ of a delayed start is causing some positive agitation in the front differential structure.
• India’s sugar exports seen a fifth lower than earlier estimate -trade body - Reuters News - India is likely to export 4.5 million tonnes of sugar in 2019/20, down almost a fifth from an earlier estimate, as a drop in global prices due to the coronavirus outbreak makes overseas sales unprofitable for mills, a senior industry official said. Lower exports from the world’s biggest sugar producer could support global prices that have fallen nearly a third from a Feb. 12 peak and help rivals such as Brazil to increase exports. "There is no export parity after the recent fall in global prices. At this price level new deals won't take place," Prakash Naiknavare, managing director of the National Federation of Cooperative Sugar Factories Ltd told Reuters.
• Louis Dreyfus posts 2019 profit slide, says no virus hit so far - Reuters News - Commodity trader Louis Dreyfus Company (LDC) reported a sharp drop in 2019 profits, confirming tough conditions on agricultural markets last year while saying it had not yet seen a major impact on its business from the coronavirus crisis. Louis Dreyfus said on Monday that group net income for 2019 had fallen to $230 million from restated 2018 income of $364 million, bringing its bottom line close to a decade low of $211 million recorded in 2015. The company cited low prices along with the continuing effects of a U.S.-Chinese trade war and the swine fever epidemic in China as a drag on its results, while pointing to resilient overall performance helped by strong earnings in cotton and freight.

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