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Sugar On The Rise

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Editor’s Remarks:

Following a period of prolonged shortages in crop yields in Brazil, sugar prices have reached a four-year high. In addition, the commodities largest producers, Brazil and Thailand, are taking their dispute over sugar quotas to the WTO, which may require floating sugar prices. Despite the fact that production is expected to fall 25.5 million tonnes, the USDA has predicted that consumption is set to rise by 27.2 million tonnes in India and China. Sugar companies could stand to make huge profits, as prices are unlikely to come down in the next 12 months. Rain has affected output across the globe, from Australia to Brazil, with Australia desperate for drier weather in the coming months. The price of sugar could continue to rise, despite warnings of the price reflecting only an increase in buyers and current stocks decreasing. Sugar may be the best performing commodity of the year but it could also be the worst performing of the next.

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