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Re: low "traffic" in the Forum
Great comments. Welcome to the forum M. I am not privy to the physical market. I’m just going by my own experiences. I would think that cheap interest rates would offset storage costs. But, nevertheless spreads tell a different story, and depletion of the warehouse stocks is obviously the reason. As far as the impact on the outright market, I continue to maintain that certified stocks do not matter as long as there is an abundance of global stocks. The buying that we’re seeing is purely speculative and I agree that the macro picture Is prompting it. The selling is largely commercial. It has also been my observation, right or wrong, that origin forward selling, which has intensified with the strength of futures, as been associated with the premium of spreads on ICE, even though it has been shrinking, together with the Selic, and of course, the Real. Today, the market has traded as far forward as Dec22. Of course, there could be multiple reasons for any event.