Raw sugar touches new 2-1/2-month peak, white sugar surges

NEW YORK/LONDON: Raw sugar futures on ICE closed up for a fifth consecutive session, touching a new 2-1/2-month peak on Thursday, as funds' appetite increased amid a better outlook for an economic recovery.

White sugar prices surged, with the front month trading almost $20 per tonne higher than the second month, an inverted market position that usually indicates strong outright physical demand for the product.

SUGAR

July raw sugar settled up 0.11 cents, or 0.9%, at 11.73 cents per lb, the highest closing price for the front month since March 11.

Dealers said market sentiment appears to have turned more positive recently.

"No one is expecting prices to recover to the levels seen in mid-February. However, with the funds more active on the buy-side, producers (are) probably keen to wait to see whether prices can improve further," a dealer said.

Broker INTL FCStone said on Wednesday it saw the global market moving into surplus in 2020/21. It also cut its estimate for the size of the deficit in 2019/20.

August white sugar settled up $9.20, or 2.4%, at $384.80 a tonne, sharply above the second month.

Dealers said white sugar supplies were tight partly due to a decline in production in Thailand this year.

COFFEE

July arabica coffee settled down 0.95 cents, or 1.0%, at 98.15 cents per lb.

Dealers noted a weakening in Brazil's real helped to weigh on prices. A recent strengthening of the currency had been a supportive factor earlier this week.

Brazil's harvest is a little behind the average for this time of the year, but not by much.

July robusta coffee was down $4, or 0.3%, at $1,198 a tonne.

COCOA

July New York cocoa settled up $1, or 0.0%, to $2,396 a tonne.

July London cocoa settled down 18 pounds, or 0.9%, to 1,895 pounds per tonne.