Yahoo Finance 'Super bearish' Wilmar behind sugar prices falling to 2024 low, traders say
By Marcelo Teixeira
NEW YORK, March 4 (Reuters) -
Sugar prices hit a 2024 low on Monday, with traders saying the move by Asian commodities trader Wilmar to deliver
more than a million metric tons
of sugar at ICE's March contract expiry last week, along with its following comments, were behind the slide.
Raw sugar prices have fallen sharply since the last trading day of the March contract on Feb. 29 and in the two following sessions, sinking to their lowest since Dec. 29 on Monday at 20.55 cents per pound.
"They (Wilmar) are trying to knock down the market, they are super bearish," said a top executive for a rival commodities trader, who asked not to be quoted as the theme is sensitive.
"They don't have all that sugar to deliver," the executive added, referring to the fact that Wilmar, although an integrated player in other parts of the world, does not own sugar plants in Brazil where the delivery will take place.
"No doubt this delivery brings a negative tune to the market in the short term," said a second executive with another trade house.
Wilmar said it does not comment on its futures' trading.
Its head of sugar analysis, however, did comment earlier this month about the supply and demand situation.
Karim Salamon said Wilmar sees an increase supplies as sugar crops in India and Thailand are performing better than expected, and Brazilian mills are boosting sugar industrial capacity ahead of the new crop.
The first and the second executives have a different view. Both believe drier than normal weather in early 2024 will hurt Brazil production, and continue to see risks of logistic bottlenecks at Brazilian ports.
A third trader, based in the United States, said Wilmar was the largest receiver of sugar in the previous expiry in October, and might had not found buyers for all the sugar.
"They may have over extended themselves (in October)," he said, indicating Wilmar could still have some of that sugar in Brazil to ship. (Reporting by Marcelo Teixeira; Editing by Lincoln Feast.)
