Price Movements - March NY world sugar 11 is down -0.02 (-0.13%) while March London ICE white sugar 5 is up +2.00 (+0.47%) indicating mixed sugar prices today [1] Production and Supply - Brazil's cumulative 2025-26 Center-South sugar output through mid-December increased by +0.9% year-on-year to 40.158 million metric tons (MMT) with the ratio of cane crushed for sugar rising to 50.91% in 2025/26 from 48.19% in 2024/25 [1] - Covrig Analytics raised its 2025/26 global sugar surplus estimate to 4.7 MMT from 4.1 MMT in October, but projected a decrease in the 2026/27 global sugar surplus to 1.4 MMT due to weak prices discouraging production [2] - Consulting firm Safras & Mercado forecasts Brazil's sugar production in 2026/27 to decline by -3.91% to 41.8 MMT from 43.5 MMT expected in 2025/26, with exports expected to fall by -11% year-on-year to 30 MMT [4] - Indian sugar production for 2025-26 surged 25% year-on-year to 11.90 MMT, with the Indian Sugar Mill Association (ISMA) raising its production estimate to 31 MMT, up +18.8% year-on-year [5] Export Dynamics - India's food secretary indicated that the government may allow additional sugar exports to alleviate a domestic supply glut, with a quota system for sugar exports introduced in 2022/23 [6] - In November, India's food ministry announced it would permit mills to export 1.5 MMT of sugar in the 2025/26 season [6] Market Influences - Expectations of index-related buying of sugar futures for the annual rebalancing of commodity indexes are supportive for prices, with Citigroup projecting inflows of $1.2 billion in sugar futures contracts this week [3]

Core Insights - Sugar prices are currently under pressure due to a stronger dollar, with March NY world sugar 11 down by 0.05 (-0.33%) and March London ICE white sugar 5 down by 1.20 (-0.28%) [1] - Despite the pressure, losses in sugar prices are limited by expectations of index-related buying, with Citigroup projecting inflows of $1.2 billion in sugar futures contracts for the annual rebalancing of commodity indexes [2] Supply Dynamics - Recent reports indicate that Brazil's sugar production is expected to decline by 3.91% in 2026/27, falling to 41.8 million metric tons (MMT) from 43.5 MMT in 2025/26, with exports anticipated to drop by 11% year-on-year to 30 MMT [3] - In contrast, Indian sugar production for the 2025-26 season has surged by 25% year-on-year to 11.90 MMT, prompting the Indian Sugar Mill Association to raise its production estimate for the same season to 31 MMT, an increase of 18.8% year-on-year [4] - The Indian government is considering allowing additional sugar exports to alleviate a domestic supply glut, with a quota of 1.5 MMT set for the 2025/26 season [5] Market Outlook - The outlook for sugar prices remains bearish due to expectations of record sugar output in Brazil, with Conab raising its production estimate for 2025/26 to 45 MMT from 44.5 MMT, and cumulative sugar output in Brazil's Center-South region increasing by 1.1% year-on-year to 39.904 MMT [6]

Core Insights - Crude oil and gasoline prices have reached one-month highs, driven by rising tensions in Iran and positive economic indicators in the US [2][3][4] Group 1: Market Dynamics - February WTI crude oil is up by $1.79 (+3.10%), while February RBOB gasoline has increased by $0.0352 (+2.00%) [1] - The unrest in Iran, which produces over 3 million barrels per day (bpd), poses a risk to crude production, potentially leading to price increases if protests escalate [3] - The US economic outlook is improving, with the December unemployment rate falling to 4.4% and the January consumer sentiment index rising to 54.0, both better than expected [4] Group 2: Supply and Demand Factors - The crude crack spread has risen to a three-week high, encouraging refiners to increase crude purchases for gasoline and distillate production [5] - Upcoming annual rebalancing of commodity indexes is expected to result in $2.2 billion inflows into oil futures contracts, which is a bullish factor for crude prices [6] Group 3: Price Forecasts - Morgan Stanley has revised its crude price forecasts downward, predicting a global oil market surplus that may peak mid-year, with Q1 forecast cut to $57.50 per barrel and Q2 forecast to $55 per barrel [7]

Group 1: Oil Price Movements - West Texas Intermediate (WTI) rose 3.2% to settle below $58 a barrel, with prices continuing to climb after settlement, indicating a potential recovery from earlier losses [1] - An annual period of commodity index rebalancing is expected to lead to increased cash flow into crude oil over the next few days, contributing to bullish momentum [2] - Call skews for Brent have strengthened as traders engage in the options market to hedge against price fluctuations [2] Group 2: Geopolitical Risks and US Actions - President Donald Trump threatened to impose severe measures on Iran if the government continues to suppress protests, which could disrupt Iranian oil supply and impact market expectations of a surplus [1] - The US plans to exert control over Venezuela's oil industry, with Energy Secretary Chris Wright stating that the US will initially offer stored crude for sale [3] - Venezuela's state-owned Petroleos de Venezuela SA is negotiating with Washington to sell crude under a framework similar to that of Chevron, the only supermajor operating in the country [4] Group 3: Market Dynamics and Company Activities - Citgo Petroleum Corp., indirectly owned by Venezuela, is considering resuming crude purchases for the first time since sanctions were imposed in 2019, while Trafigura Group has also shown interest [5] - Chevron is in discussions to extend its operating license in Venezuela, and Vitol Group has reportedly received a preliminary US license for oil negotiations [5] - Amrita Sen from Energy Aspects noted that the main impact of the situation in Venezuela will be a shift in trade flows, with more oil directed to the US at the expense of China, but not necessarily a significant increase in Venezuelan production [4]

Group 1 - Crude oil and gasoline prices are rising due to stronger-than-expected US economic data indicating increased energy demand and upcoming rebalancing of commodity indexes, which will lead to buying of oil contracts [2][3] - Citigroup forecasts that the BCOM and S&P GSCI indexes will see inflows of $2.2 billion in futures contracts over the next week for rebalancing purposes [3] - Recent US economic indicators show a stronger labor market, with December Challenger job cuts down 8.3% year-over-year to 35,553, and Q3 nonfarm productivity rising 4.9%, the largest increase in two years [4] Group 2 - The US Energy Department's decision to selectively roll back sanctions on Venezuelan crude exports may increase global oil supplies, putting pressure on crude prices [5] - Morgan Stanley has revised its crude price forecasts downward, predicting a global oil market surplus that will peak mid-year, with Q1 forecast cut to $57.50 per barrel and Q2 forecast to $55 per barrel [6]

Group 1 - Gold steadied around $4,450 an ounce, following a 2.7% increase after the capture of Venezuelan leader Nicolás Maduro, with uncertainty over Venezuela's governance impacting market sentiment [1][3] - Silver has risen for three consecutive days, reaching $77.90 an ounce, with a notable increase of 3.6% on Tuesday [6][7] - The Federal Reserve's interest rate policy is under scrutiny, with Minneapolis Fed President Neel Kashkari indicating rates may be near neutral, relying on upcoming economic data to guide decisions [2] Group 2 - Gold achieved its best annual performance since 1979, supported by central bank buying and inflows into bullion-backed ETFs, alongside three rate cuts by the Fed [4] - Leading banks, including Goldman Sachs, forecast further gains for gold, predicting a potential rally to $4,900 an ounce due to expected additional rate reductions [5] - Concerns exist regarding a rebalancing of commodity indexes that may pressure gold and silver prices, as passive tracking funds may need to adjust their holdings [6]

Core Viewpoint - Gold prices are experiencing gains as investors anticipate key U.S. economic data that may influence monetary policy outlook [1][2] Group 1: Market Performance - New York futures for gold increased by 0.6% to $4,479.90 per troy ounce [1] - The U.S. dollar index remained stable at 98.24 [1] - Gold's recent rise was partly driven by the U.S. capture of Venezuela's President Nicolas Maduro, which heightened demand for safe-haven assets [1] Group 2: Future Outlook - Gold has recently achieved its strongest annual performance since 1979 [2] - In the short term, gold prices may face downward pressure due to commodity index rebalancing, which could lead passive funds to reduce their positions following last year's significant rally [2]