Preliminary information from two traders on Thursday indicated that deliveries of raw sugar upon the expiry of the March contract SBH4 on the ICE exchange amounted to 25,751 lots, equivalent to approximately 1.3 million metric tons.
Wilmar International, an Asian commodities trader, reportedly emerged as the primary deliverer of sugar with 22,562 lots, totaling 1.14 million tons. French trader Sucden was noted as the primary receiver, acquiring 17,692 lots or roughly 900,000 tons, as per the traders’ statements.
Official data on the delivery is expected to be released by ICE on Friday.
This marks the second-largest delivery for a March contract, trailing only behind the 26,350 lots delivered in 2022, according to ICE data compiled by Reuters. However, it falls short of the all-time record set at 56,470 lots delivered during the October expiry last year.
Typically, significant deliveries are viewed as bearish for the market as they suggest that traders were unable to secure better deals for the sugar in the physical market.
On Thursday, the March contract experienced a 6% decline on its final trading day. One of the traders speculated that potential receivers might have reduced their positions by selling futures, contributing to the pronounced drop in the spot contract.
The trader remarked, “You might make a case that receivers were reducing their positions,” alluding to the market’s downward movement.
While there was limited clarity regarding the origin of most of the sugar, one of the traders suggested that it likely originated from the Santos port in Brazil.