The sugar market rallies from time to time and the rally can be large, is it has been since last summer. These sugar rallies are exaggerated by the lack of marginal supply as so much of the world's production is tied up within large vertically-integrated agri-businesses. When prices eventually fall, they typically return all the way back to the starting point. The recent rally seems to have stalled and is showing signs of an imminent decline, as shown in these two charts of the London price:
London is not the dominant market for sugar but these signals have only been generated there. The better market to trade is the more liquid #11 New York contract, which we would choose to express this view.
This is the second attempt that we have made to sell sugar shor, based on these same weekly top extensions but the new information that we now have is this fresh compression.