LONDON: Raw sugar prices on ICE rose on Thursday as oil prices surged after the International Energy Agency (IEA) warned Russia’s war with Ukraine could result in three million barrels a day of Russian oil and products being shut in from next month.
Rising energy prices tend to prompt cane mills in top producer Brazil to divert output away from sugar towards ethanol, a cane-based biofuel.
May raw sugar rose 1% to 18.74 cents per lb at 1328 GMT.
Dealers cited a 18.50-20.50 trading range for sugar but said it has an upside bias, with the war in Ukraine far from over and with any falls in the sugar price expected to prompt Brazil’s cane mills to divert output to ethanol.
Russia’s Federal Anti-Monopoly Service is conducting “anti-cartel” inspections at major sugar producers due to a sharp increase in sugar prices and “unjustified” shortages in some regions amid a rush to buy.
May white sugar rose 0.8% to $526.70 a tonne.
May arabica coffee fell 1% to $2.1545 per lb, but remained some way above the four-month low of $2.1015 hit earlier this week.
Top coffee grower Brazil is expected to produce 61.1 million 60-kg bags of beans in the 2022/23 crop, 8% more than in 2021/22, but 12% below the record seen in 2020/21, consultancy Safras & Mercado said.
May robusta coffee fell 0.5% to $2,139 a tonne.
Robusta supplies remained limited in key producer Indonesia ahead of a mini harvest in April, traders said.
May London cocoa fell 1.8% to 1,712 pounds per tonne?.
Dealers said there has been moderate buying interest from industry of late, but speculators are reluctant to pile in and push prices higher.
May New York cocoa fell 2.3% to $2,504a tonne.