Sugar prices continued to slide on Monday, hitting a fresh four-month low, as traders turned their attention to sluggish demand, when the Brazilian harvest season was close to the end. Raw sugar for March delivery skidded 0.9% to settle at 18.94 cents a pound on the ICE Futures U.S. exchange, the lowest level since early August.

“Everything seems to be conspiring to depress the market; weak physicals, low white premium, high non-index funds’ long, and now doubts about Chinese imports and a new technology which may depress demand long term,” wrote analysts with Marex Spectron in a note to clients.

Speculators, who had held a record net-long position until end-September, have been reducing their holdings since then. A Friday’s report from the U.S. Commodity Futures Trading Commission showed money managers further slashed their bullish bets in the week ended Nov. 29 to 168,635 lots, a 41% reduction from the peak.

Many traders had relied on the idea that the global sugar market was set to be in deficit in 2016 for the second year in a row, but analysts argued that they had been ignoring all the vagaries in the macro market and sugar fundamentals that have gradually eroded sugar’s bullish story.
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