Liffe sugar soars

Liffe March white sugar ended $31.90 higher at $807.40 per tonne on Tuesday. Fears of potential delays to exports from top grower India push up prices, also exacerbated by worries about possible downward revisions to the crop outlook. Liffe May cocoa closed at 1,973 pounds a tonne, 25 pounds higher.
Dealers say the market is building a base, supported by industry buying, after an eroding risk premium linked to political tensions in top producer Ivory Coast. Liffe March robusta coffee is $55 higher on the day at $2,110 a tonne, with one dealer saying industry accounts are buying robusta because of its large discount to arabica.
A panel of Indian ministers will review 500,000 tonnes of sugar permitted for export, government sources said, as mounting pressure on the government to tackle high food price inflation has led to worries shipments could be delayed. "There's still great uncertainty about what India will commit to be exported," said VM Group analyst Gary Mead. "Until this is openly resolved, I'd expect the market to drift up or down quite frequently." Dealers said possible downward revisions to the crop outlook in India were also contributing to doubts about the level of exports from the world's second largest producer this season.
"The market has uncertainty about what India will actually export in the end. Everyone thinks they'll export the 500,000 (tonnes), but everyone is concerned what will happen after that," one London dealer said. Dealers also cited recent news that Algeria is to suspend customs duties and value added tax on imports of sugar as a supportive factor. The move was taken in response to riots over rising food prices.
"This should generate end-user buying and will probably be aiding the (sugar) market," one London dealer said. "Dialogue seems to be taking place in the Ivory Coast, but with the situation currently there, anything goes. So there's still sensitivity in the market to what goes on there," one London dealer said.
At least five people were killed in clashes between supporters of Ivory Coast presidential claimant Alassane Ouattara and forces loyal to incumbent Laurent Gbagbo, a Reuters witness reported on Tuesday. "In physical terms, we're seeing the full flow of cocoa going through, and it hasn't been as inhibited as people originally thought (because of Ivory Coast unrest)," the dealer added.