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Raw sugar hits 4-1/2-year high

NEW YORK/LONDON: Raw sugar futures on ICE hit a 4-1/2-year high on Monday as energy prices continued to soar, with a move by Brazil’s Petrobras to hike fuel ethanol prices by nearly 7% last week still boosting sentiment.

Rising energy prices prompt cane mills in Brazil to raise output of the cane-based biofuel ethanol at the expense of sugar.

Meanwhile, coffee futures rose and cocoa prices fell in the session.

SUGAR

March raw sugar settled up 0.04 cents, or 0.2%, at 20.33 cents per lb, having touched 20.61 cents per lb in the session, its highest level since late February 2017.

US crude oil futures hit seven-year highs earlier as an energy crisis gripping major economies showed no sign of easing.

Alvean, the world’s largest sugar trader, believes demand will pick up in the coming months as consuming countries have used most of their available stocks.

“The (sugar) market is tight but sufficiently supplied for the coming year, but after that it looks like being in deficit – and extreme deficit if we suffer any more weather surprises,” broker Marex Spectron said.

Sugar speculators cut their net long position by 452 contracts to 162,845 in the week to Oct. 5, CFTC data showed.

December white sugar settled up $2.20, or 0.4%, at $521.90 a tonne.

COFFEE

December arabica coffee settled up 2.9 cents, or 1.4%, at $2.0425 per lb, having closed up 1.7% on Friday.

Coffee farmers in Colombia, the world’s No. 2 arabica producer, have failed to deliver up to 1 million bags of beans this year, or nearly 10% of the country’s crop, leaving exporters, traders and roasters facing steep losses, industry sources told Reuters.

Arabica speculators raised their net long position by 2,428 contracts to 43,940 in the week to Oct. 5.

November robusta coffee settled down $18, or 0.9%, at $2,099 a tonne.

COCOA

December New York cocoa settled down $68, or 2.5%, to $2,682 a tonne.

December London cocoa settled down 26 pounds, or 1.4%, to 1,860 pounds per tonne.

Sporadic sunny weather in many of Ivory Coast’s cocoa growing regions last week encouraged farmers’ hopes for a bountiful main crop, calming fears that a fungal epidemic could hinder the quality of the harvest.

Cocoa speculators switched to a net long position of 10,784 contracts in the week to Oct. 5, adding 13,877 contracts.

Raw sugar hits 4-1/2-year high

Source: Brecorder

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