Thai sugar premiums are likely to dip further in the next few days amid quiet trade, as some exporters are keen to sell for shipment next year, traders said on Monday.
Thai raw sugar premiums for March-May 2004 shipment were quoted lower on Monday at 155 points over CSCE futures without bids. It was quoted at 160 points over last week without bids.
"A few big exporting firms seem keen to sell sugar from the new crop for shipment next year," said one trader at a major international trading firm, referring to the 2004/05 crop.
"We have been talking. But no deal has been done."
Thailand is a key sugar exporter in Asia. Its major buyers include Indonesia, Japan, South Korea and Malaysia.
Most exporters have sold forward positions from the 2003/04 crop (October-November) for shipment this year to international trading firms, traders said.
The 2003/04 harvest has been under way for almost four months and is due to end in April.
Traders put the 2003/04 cane crop at no more than 65 million tonnes, or around 6.9 million tonnes of both raws and whites, due to drought in some growing areas.
Industry officials, traders and millers had projected the 2003/04 cane crop at 70-71 million tonnes. The 2002/03 cane crop was a record 74.07 million tonnes.
Farmers in most growing areas have yet to plant the new 2004/05 (October-November) cane crop. They will not do so until the rainy season arrives in May as they depend on rainfall to water their cane.
Farmers in the north-east normally plant a new crop soon after they finish harvesting the old one.
However, persistent drought in the north-east, which produces about 40 percent of Thailand's cane, has prevented farmers from planting their 2004/05 cane crop for more than two months now, officials and traders said.
Thailand's 2004/05 crop output has yet to be estimated.
On Friday, the United Nation's World Food Programme bought 202,000 tonnes of white sugar for Iraq for April, May and June shipment.
"There is talk in the market that the Sucden trading firm has won the tender and they are likely to supply Iraq with sugar from Dubai," said one trader.
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