Mumbai, 12 Mar (Commoditiescontrol): ICE raw sugar prices rebounded on Monday, rising to over one-week high after last week's slide to two-month low prompted short-covering, traders said.
Sugar prices slid in recent time, as forecast for rain in Brazil boosted production prospect for the world's largest sugar exporter.
Forecaster Maxar Technologies said that moderate rain is expected in Brazil's sugar-growing regions over the next five days, which fueled long liquidation in sugar futures. Also, weakness in the Brazilian real weighed on sugar after the real on Friday fell to a 1-week low against the dollar. The weaker real encourages export selling from Brazil's sugar producers.
ICE sugar futures for May delivery rose 0.80 cents or 3.8% at 21.95 cents per lb. Prices were down 3.8% for the week ended March 8th. In the last week of February, the contract hit its lowest since mid-January at 22.71.
May London white sugar contract gained $19.60 or 3.3% at $617.10 a metric ton. The contract ended 0.85% lower for the week.
Dealers said sugar has been supported by the prospect of a smaller cane crop in top producer Brazil in the upcoming 2024/25 season.
The natural sweetener suffered loass in the previuos session after the European Union area planted with sugar beet seen growing 2-3% next season, helped tame global deficit outlook.
France's largest sugar producer Tereos said, the EU's area under sugar beet plantation is growing meagerly, despite good sugar prices.
Last Tuesday, BP Bunge Bioenergia projected that the global sugar deficit would widen to 1.6 MMT in 2024/25 as Brazil's sugar production in 2024/25 falls by about 4.4% to 40.8 MMT due to dry conditions that curb sugar cane yields. Earlier in the day, sugar prices initially dropped to 2-month lows on rising sugar production in Brazil, the world's largest sugar producer.
Consultancy Datagro expects Brazil's Centre-South sugar production to fall nearly 5% in the new season.
Sugar cane planting in the western Indian states of Maharashtra and Karnataka is expected to fall for the 2024/25 season starting Oct.1, an industry body said on Wednesday.
The global sugar deficit is expected to widen to 788,000 tons in the 2024/25 year, meaning supplies will remain tight and prices are likely to stay high, analyst Green Pool said on Tuesday in its initial forecast for the crop year.
European Union lawmakers granted Ukrainian food producers tariff-free access to EU markets for another year.
Ukraine sugar production is seen rising to a seven-year high in the upcoming 2024/25 season, an executive with a major Ukrainian agricultural company said.
Top producer Brazil exported 3.02 million metric tons of sugar in February, three times the volume seen in the same month a year earlier.
Commodity Futures Trading Commission (CFTC) data on showed speculators have added 17,391 contracts to their net long position in raw sugar to 21,950 lots.
For Tuesday, support for the May Sugar contract is at 21.39 cents and 20.83 cents, with resistance at 22.25 cents and 23.11 cents.
(By Commoditiescontrol Bureau: 09820130172)
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