Mumbai, 16 Apr (Commoditiescontrol): ICE raw sugar futures ended sharply lower on Monday, as robust sugar output in Brazil undercut prices while weaker Brazilian Real encourage exports. The natural sweetener was already under pressure due to the bearish carryover from last week's increased sugar production outlook.
ICE sugar futures for May delivery settled down 0.43 cents or 2% at 20.02 cents per lb, slumping to the lowest price since late December. It lost 7% for the week.
May London ICE white sugar contract lost $13.90 or 2.2% at $614.20 a metric ton, coming off 1-month high recorded in the previous week. The contract ended the week 2.75% softer.
Dealers cited high stocks levels in Brazil at the end of the 2023/24 crop and the good start to the new crop.
Brazil's Center-South sugar output in the second half of March was 183,000 MT, up 9% from last year. Brazil's center-south sugarcane crushing totalled 5.04 million metric tons in the second half of March, data from industry group UNICA showed, up 6.5% from a year ago.
Brazil's sugar mills have ramped up their cane crushing for more sugar and less ethanol. Mills have crushed 48.87% of total cane for sugar production this year, up from 45.86% last year.
Last week, Vietnam's Office of the Cane and Sugar Board reported that Thailand's 2023/24 sugar production from Dec-Mar was 8.75 MMT, above a Feb estimate from the Thai Sugar Millers Corp for sugar production of 7.5 MMT.
Earlier, the Indian Sugar and Bioenergy Manufacturers Association reported that India's 2023/24 sugar production from Oct-Mar rose 0.4% on year to 30.2 MMT as more sugar mills stayed open to crush sugarcane. As of March 31, 322 Indian sugar mills had closed operations, compared with 346 mills that were closed at the same time last year.
Egypt on Monday extended the deadline for offers in its latest tender for 50,000 metric tons of raw cane sugar to March 30 from March 23.
Last week, Fitch Solutions report suggested that the decreased sugarcane plantings in key Indian states, alongside an anticipated reduction in Brazil's centre-south region production for the 2024/25 season, are supporting sugar prices. It added, however, that current strong production out of Brazil is capping sugar's gains.
Commodity Futures Trading Commission (CFTC) data on showed speculators have reduced 11,669 contracts to their net long position in raw sugar to 26,860 lots.
For Tuesday, support for the Jul Sugar contract is at 19.65 cents and 19.48 cents, with resistance at 20.14 cents and 20.46 cents.
(By Commoditiescontrol Bureau: 09820130172)
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