Selling into weakness at decade lows is seldom a winning strategy

The #11 world sugar market has trended lower throughout most of 2019. The bears have been chasing a surplus crop in India as well as lower quality stocks of Thai raw exports that have caused weakness in nearby tape. Compounding the move lower, speculative funds have been consistently extending short positions.

As recently as late June, the CFTC net spec position was basically squared up and flat. However, the past two and half months have seen accelerated selling pressure coming from the spec community, and now cumulative net shorts stand at -164,105 total shorts, the shortest position ever held by funds. To put this in perspective, they now hold a record 17 percent short position as a share of total open interest.

Weekly #11 world sugar futures & managed money shorts


Source: DTN, CFTC, McKeany-Flavell
Posted by: Information Services
Our Information Services team assists our clients with understanding commodity and ingredient market dynamics. Using our extensive database of intelligence, we also produce regular commodity and commercial market publications covering supply and demand fundamentals, news alerts on events that shape the markets, and resource guides to give you a complete picture of the industries we monitor.

Leave A Comment