Agri Commodity Markets Research April 2023: Sugar Rush

The S&P GSCI Agriculture Index has fallen by 3.7% so far in April amid declines across virtually all G&O markets. The successful operation of the Black Sea Grain Initiative alongside very strong Russian wheat exports have helped cool G&O prices. However, there is short-term risk on the horizon given that, according to Russia, the deal will expire next month, and we expect high volatility as the deadline approaches. In stark contrast to G&O, soft commodities saw an impressive rally. With low short-term availability of sugar, coffee, and cocoa to be sold against the rally, fund buying is influencing current market dynamics. In ICE Sugar #11, funds are approaching their record net long position.