Sugar Quarterly Q3 2020

Rabobank’s short-term outlook rests on two major factors: 1) worldwide cane and beet harvests in Q4 2020, and 2) the significant role demand could play in Q4 2020, if and when pandemic-driven consumption declines appear in trade.

Report summary

“Revisions that have lowered our 2019/20 deficit and created a small 2020/21 global sugar surplus point to a well-supplied market in the coming 12 months. In turn, this suggests that raw sugar prices will continue trading in a USc 11/lb to USc 13/lb range – constrained to the downside by Brazil’s ethanol parity and to the upside by India’s export parity,” according to Andy Duff, Global Strategist – Sugar.

“Still, there remain opportunities – Rabobank notes the expectations for an elevated white premium and a generous Far East premium. These stem primarily from a sharp fall in 2020/21 Thai exports and spell better prospects for global refineries and Asia-focused exporters alike.”

Broader market sentiment in FX, equities, and commodity markets will continue to drive volatility, particularly if/when they adjust the 2020/21 incentives for Brazilian millers. Furthermore, the emerging popularity of ag commodities among speculators and index funds adds a fresh dynamic to the global outlook.

  • Andy Duff

    Head of RaboResearch Food & Agribusiness - South America; Global Strategist - Sugar
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  • Maria Afonso

    Senior Analyst – Sugar, Grains & Oilseeds
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  • Pablo Sherwell

    Head of RaboResearch Food & Agribusiness - North America
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  • Charles Clack

    Commodity Analyst
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  • Lief Chiang

    Analyst - Grains & Oilseeds
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  • Stephen Nicholson

    Senior Analyst - Grains & Oilseeds
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