At The Close  |  JUN 2006

At The Close by Vikrant Goyal

Stocks & Commodities V. 24:6 (97, 96): At The Close by Vikrant Goyal A Sweet Report Sugar prices are moving up after a lull of a quarter century. Will history repeat itself? Since 1966, global sugar prices have seen two major boom– bust cycles. Remarkably, both cycles seemed to echo each other in terms of the time taken for each rise and fall; where the two cycles are superimposed on each other. Even more remarkable is that the current upmove in sugar seems to be following the pattern of the earlier two cycles. In Figure 3, the percentage moves and time taken for each phase of the boom periods of all three cycles (1972–76, 1978–82, and 2004–present) are displayed. Clearly, both earlier cycles had similar first acts, and the same thing seems to be happening this time around. The eventual fall, still in the distant future, will be the second act, of course.

by Vikrant Goyal