Like other commodities, sugar is seen as a "sweet" haven from financial market turmoil and dropping equity prices. Produced in more than 135 countries from its two main sources: sugar beets and sugarcane, Sugar not only satisfies a person's sweet tooth, it also provides investors with an almost reliable avenue of diversifying portfolios. Although comparable to other investment instruments, betting on this precious sweet-tasting soluble carbohydrate comes with risks. However, by knowing how to work your way through the many different investment options, one can find lesser riskier paths to investing on this commodity.
The process of harvesting sugarcane dates to 8th century BCE in the region of the Indian subcontinent. Originally, people just chewed on the plants to taste its sweet juice until Indians discovered the process of turning the plant's juice into granulated sugar crystals sometime in the 5th century CE.
Come early 12th century, sugar trading centered in Europe with Venice becoming known as its main refining center by the 15th century. During the same period, sugar "swept through society" as it reached more locations and became more available. By the end of the 15th century, production reached 1,400 tonnes annually.
From the 19th century up to present day, sugar is found in almost every household kitchen in the world reaching an annual production of 179 million metric tons in 2020.
The price of Sugar in the world market follows the pattern of its seasonal harvests around the world. Generally, with Brazil being the largest producer in the world, the yield spell in this country greatly affects the value of this sweet commodity. Not only that, economic situations and currency fluctuations in the top producing countries like Brazil, India, Europe, USA and China can also drive the price of this commodity up or pull it down.
Aside from the production side, global demand can also cause the movement of its price. It would be important to note that China, Europe and the United States are the commodity’s top consumers in the world.
Technically, the value of sugar always follows the balancing trend of supply and demand. Another factor that shouldn't be overlooked, are the regulations and tariffs imposed by many countries. Several governments would occasionally subsidize sugar farmers in order to keep domestic prices to a low and prevent importation.
Other factors also include: ethanol demand (which is used in the production), health concerns and weather disturbances in high producing countries.
Here are several ways to trade for this commodity in the market:
Sugar No. 11 is the market for the futures price of the unrefined version of this commodity that is also a common ingredient in food and key component in ethanol production. Considered as the worldwide benchmark for trading raw material, the price of the Sugar No. 11 is also seen as an economic indicator for major producing nations like Brazil.
The equivalent of the No. 11 futures is 112,000 lbs. of raw cane.
There are several ways of engaging in CFD trading. All you need to do choose a reliable broker or sign-up on a CFD trading platform such as eToro to open an account and deposit your fund.
Investing on this commodity via the eToro's CFD trading platform doesn't require any storage fees since you won't be trading any physical assets.
Currently, sugar has a 52-week range of $0.1959 - $0.2006 and 1-year return of 58.64%. The Sugar No. 11 Futures price has a 52-week range of $11.73 - $20.37 with a 1-year change of 59.44%.
The market value of Sugar #11 when this page was accessed is
If you're considering to invest or trade SUGAR CFDs, then it would be much simpler to click the button below. This will take you directly to eToro's trading page for this commodity.
But before you can trade sugar on eToro, you'll need to open an account with them and this will only take a few minutes to accomplish.
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