As seen in the week of March 29, old crop and new crop diverged, with a loss of $10.70/mt on the front end and a gain of $14.10/mt for the closest new-crop contract.
After just two sessions in the week of April 5, the spotlight is back on old-crop supplies with the May up $44.30/mt, which compares to $7.60/mt for the November contract.
A look at futures spreads would also support the front-end trade as signaling the most bullish signs. The April 6 May/July spread strengthened to a $50/mt inverse during the session, close to its strongest inverse of $52.60/mt reached on March 15. This compares to the three-year average spread or carry of minus $7.20/mt.
This compares to the current Nov/Jan spread of minus $1/mt on April 6, after reaching inverted territory this session, a weak carry that signals a bullish view of fundamentals and compares to the three-year average on this date of minus $5.13/mt.
Cliff Jamieson can be reached at email@example.com
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