Mumbai, 9 Oct (Commoditiescontrol): Sugar prices collected gains during the week ended Oct 6th, the fears of tighter supplies resurfaced causing a rush among traders to cover their short position.
In fact, on Friday, ICE raw sugar futures settled higher, extending the previous session gain, as concerns about smaller global sugar output sparked fund short covering in sugar futures. On Thursday, the USDA's Foreign Agricultural Service (FAS) projected 2023/24 Thailand sugar production at 9.4 MMT, down 15% on year.
ICE sugar futures for March delivery settled up 0.58 cents, or 2.2% at 26.74 cents per lb. The contract added 1.79% for the week.
Last Friday, the ICE raw sugar October contract expired with a record delivery of 2.87 million metric tons, which was seen as bearish. But, the recent market gains are proving that observation wrong.
December London white sugar added $11.90, or 1.7%, at $709.20 a tonne. The contract ended 0.46% higher this week.
Dealers said sugar is consolidating at historically high levels, close to a 12-year price peak, thanks to tight global supplies and in spite of a weak Brazilian currency that usually drives mills to sell, while concerns over macro-economic growth keep gains in check.
Most of the record physical delivery of sugar at the expiration of the October contract on ICE will head to China, according to traders with knowledge of deals.
Germany's refined sugar production in the new 2023/24 season is forecast to rise to about 4.36 million metric tons, up some 12.9% from last season.
The EU's sugar output is expected to rise 3% to 15.4 million metric tons in 2023/24 thanks to reduced beet acreage in France versus increased plantings in other member states, the U.S. Department of Agriculture's (USDA) Foreign Agricultural Service (FAS) said.
India is expected to produce 33.6 million metric tons of white sugar in 2023/24 – a supply level that might not meet consumption needs, FAS said.
Speculators reduced their bullish bets in futures of raw sugar in the week to Sept. 26, the CFTC said.
Sugar output fears are once again playing out in the markets as fears of drought conditions in the growing region linger, forcing analysts to readjust their previous estimates and the availability of the sweetener during the busy season. There's one more element added recently was the escalation of violance in the middle east. Israel-Hamas hostality will adde pressure on financial markets, which could mean more volatility in the near term.
For Monday, support for the March Sugar contract is at 26.30 cents and 25.87 cents, with resistance at 27.00 cents and 27.27 cents.
(By Commoditiescontrol Bureau: 09820130172)
0 Comments 
Post Comment 
