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Sugar Futures Trading Basics
Sugar futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of sugar (eg. 112000 pounds) at a predetermined price on a future delivery date.
Sugar Futures Exchanges
You can trade Sugar futures at NYSE Euronext (Euronext) and Tokyo Grain Exchange (TGE).
Euronext Raw Sugar (No. 408) futures prices are quoted in dollars and cents per pound and are traded in lot sizes of 112000 pounds (50 long tons).
Euronext White Sugar (No. 407) futures are traded in units of 50 tonnes and contract prices are quoted in dollars and cents per metric ton.
TGE Raw Sugar futures prices are quoted in yen per metric ton and are traded in lot sizes of 50 tonnes .
| Exchange & Product Name | Symbol | Contract Size | Initial Margin |
| Euronext Raw Sugar (No. 408) Futures (Price Quotes) | RSU | 112000 pounds (Full Contract Spec) | USD 1,456 (approx. 12%) (Latest Margin Info) |
| Euronext White Sugar (No. 407) Futures (Price Quotes) | WSG | 50 tonnes (Full Contract Spec) | USD 1,650 (approx. 10%) (Latest Margin Info) |
| TGE Raw Sugar Futures (Price Quotes) | - | 50 tonnes (Full Contract Spec) | JPY 75,000 (approx. 6%) (Latest Margin Info) |
Sugar Futures Trading Basics
Consumers and producers of sugar can manage sugar price risk by purchasing and selling sugar futures. Sugar producers can employ a short hedge to lock in a selling price for the sugar they produce while businesses that require sugar can utilize a long hedge to secure a purchase price for the commodity they need.
Sugar futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable sugar price movement. Speculators buy sugar futures when they believe that sugar prices will go up. Conversely, they will sell sugar futures when they think that sugar prices will fall.
Learn More About Sugar Futures & Options Trading
- Buying Sugar Futures to Profit from a Rise in Sugar Prices
- Selling Sugar Futures to Profit from a Fall in Sugar Prices
- Sugar Options Basics
- Sugar Call Option Trading Basics
- Sugar Put Option Trading Basics
- Hedging Against Rising Sugar Prices with Sugar Futures
- Hedging Against Falling Sugar Prices with Sugar Futures
How to Start Trading Sugar Futures
To buy or sell sugar futures, you need to open a trading account with a broker that handles futures trades. Most online brokerages out there only deal with stocks and stock options. Only a few such as TD Ameritrade lets you trade futures and futures options as well. TD Ameritrade also provide a virtual trading platform where beginners can try out futures and options trading in real market conditions without using real money.
