login_img.jpg
Login ID:
Password:
Partner Login
Contact Us : 7066511911

Weekly: ICE raw sugar futures track oil higher; US plans to cut import from Mexico

1 Apr 2024 8:47 am
 Comments 0 Comments  |  Comments Post Comment  |  Font Size A A A 

Mumbai, 1 Apr (Commoditiescontrol): Sugar prices have staged a recovery during the truncated week to Mar 28th, helped by sugar producers in the United States seeking stern measures against imports from Mexico, while rising geopliticial concerns boosting crude oil prices extended support to natural sweetener.

ICE raw sugar futures settled higher on Thursday, led by surge in crude oil price and carryover support from US sugar producers call for reduced sugar imports from Mexico.

ICE sugar futures for May delivery settled up 0.33 cents or 1.5% at 22.52 cents per lb. Prices rose 3.1% during the week.

May London white sugar contract gained $6.90 or 1.1% at $652.50 a metric ton, coming off 1-month high recorded in the previous week. The contract added 2.13% during just ended week.

Dealers said recent rainfall appeared to have improved the outlook for Brazil's 2024/25 cane crop, although some concerns about dry conditions remained.

In the previous session sugar price eased as world's largest exporter Brazil reported higher sugar production. Unica reported that Brazil's Center-South sugar output in the first half of March was 64,000 MT, up 313% from the same time last year. Also, Brazilian sugar output so far in the 2023-24 marketing year through mid-March is up 25.8% on year to 42.245 MMT.

"Brazil may have a strong early harvest, which may be bearish in the short term, but harvested cane volumes may disappoint later in the year," Rabobank said in a report.

Brazil's sugar mills have ramped up their cane crushing for more sugar and less ethanol. Mills have crushed 48.96% of total cane for sugar production this year, up from 45.93% last year.

Last week, sugar gained support as US producers called for a reduction in sugar imports from Mexico. The American Sugar Coalition wants the government to lower the amount of sugar Mexico can send to the US by 44%, which would likely boost prices and require the US to purchase sugar from other countries, tapping already tight global sugar supplies.

ASR Group, the largest sugar company in the United States, has six to eight weeks of raw sugar stocks at its Baltimore sugar refinery, which is supplied by vessels coming to the Port of Baltimore. The port is blocked after the collapse of a bridge. The Baltimore refinery is one of the largest plants in the country, producing 6 million pounds of refined sugar per day.

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.

Fitch report contradicts a recent forecast by India's trade body that suggested improvement in country's sugarcane production. The Indian Sugar and Bioenergy Manufacturers Association Wednesday raised its forecast for India's sugarcane production in the 2023-24 marketing year (that began on Oct 1) by 2.9% to 34 MMT from January's forecast of 33.05 MMT. Higher sugarcane production likely means higher refined sugar production, depending on how much of that sugarcane is converted into ethanol.

Commodity Futures Trading Commission (CFTC) data on showed speculators have reduced 5,465 contracts to their net long position in raw sugar to 8,011 lots.

Although, sugar prices gained during the week due to external factors, the commodity continues to benefit from improving weather conditions, especially in the sugar cane growing region. That remains a big bearish factor for prices. Overall impact of improved weather condition is: rise in output and hence, the availability of sugar. Several industry reports including Unica, have pegged a sharp rise in Brazilian sugar production. That should help cut global deficit prospect. However, the drought conditions in growing region such as Thailand remains a concern. Traders have once again altered their price view to bearish. Analysts are forced to readjust their production estimates and availability of the sweetener. Yet, the bullish price pattern remains intact though funds have decided to cut their long position. A clarity on production is necessary before taking a fresh bet.

For Monday, support for the May Sugar contract is at 22.19 cents and 21.86 cents, with resistance at 22.72 cents and 22.92 cents.

(By Commoditiescontrol Bureau: 09820130172)


       
  Rate this story 1 out of 52 out of 53 out of 54 out of 55 out of 5 Rated
0.0

   Post comment
Comment :

Note : This forum is moderated. We reserve the right to not publish and/or edit the comment on the site, if the comment is offensive, contains inappropriate data or violates our editorial policy.
Name :  
Email :  
   

Post Comment  

Latest Special Reports
Weekly: ICE sugar futures under pressure as Brazilian p...
Weekly: ICE raw sugar futures unchanged battling supply...
Weekly: ICE raw sugar futures fall; improved weather co...
Weekly: ICE raw sugar futures slid lower; increased sug...
Weekly: ICE raw sugar futures post double digit price d...
more
Top 5 News
US Soybean net sales for May 10-16 at 279,400 MT, up 5 ...
US Cotton net export sales for May 10-16 at 202,900 RB,...
Pea (Matar) Kanpur U.P. Line Counter-trend Rally / Nex...
Deesa Castor Seed (Plant) Trending Lower / Next Suppor...
Sunflower Refined Oil (AP) Inflection Point: Trading N...
Top 5 Market Commentary
Weaker Dollar Boosts Sugar Prices; Brazilian Production...
ICE Cotton Prices Dip Ahead of Holiday, But Posts Weekl...
CBOT Wheat Futures Surge Amid Global Crop Concerns
Gold Rises as Dollar Slips, But Posts Worst Week in Fiv...
Crude oil posts weekly drop as interest rate policy spu...
Copyright © CC Commodity Info Services LLP. All rights reserved.