NEW YORK/LONDON: Sugar futures rose on Friday as jitters over possible production delays in the world's most important sugar growing area, the center-south region of Brazil, stoked the advance.
The other softs markets lost ground as weakness in the commodity sector weighed on the complex.
New York's May raw sugar contract on ICE rose 0.21 cent to trade at 25.07 cents per lb at 12:12 p.m. EST (1712 GMT). London May white sugar futures jumped $10.20, or 1.5 percent, to $656.20 a tonne.
Mike McDougall, senior vice president of brokerage Newedge USA in New York, said news that Brazil's sugar harvest is facing a late start boosted the nearby contracts in both London and New York.
Industry group Unica said on Wednesday the 2012/13 center-south cane crushing season will start almost two weeks later than average.
The delay would provide the "underlying reason" why Cargill took delivery of over 880,000 tonnes of sugar as the March contract in New York expired this week, McDougall said.
"Cargill have a long track record of taking big deliveries, and must be confident of finding homes for the sugar," said Stefan Uhlenbrock, analyst with F.O. Licht.
McDougall believes the strength in the May/July spread on ICE and the May/August spread on Liffe could be largely explained by worries over a harvest delay.
"It seems that Cargill have homes lined up (one leading analyst suspects around 75 percent of the tonnage is already sold)," added Thomas Kujawa of brokerage Sucden Financial.
COCOA SLIDES AND COFFEE MIXED
Cocoa futures were weaker. US beans were down in range-bound trading as the dollar firmed, dipping along with the commodity complex and feeling pressure from the firm pound against the US dollar.
The benchmark May contract initially moved higher, then met resistance at the 100-day moving average around $2,392 per tonne and took further pressure from hedging, dealers said.
ICE May cocoa was down $32, or 1.35 percent, to close at $2,334 a tonne. London May cocoa declined 9 pounds to settle at 1,495 pounds per tonne.
"The dollar is going up, which is softening New York (ICE) a little bit," a London-based cocoa futures broker said.
Robusta coffee futures were steady, with dealers focused on a retention of supplies by growers in leading robusta producer Vietnam.
Arabica coffee futures were trapped in rangebound dealings, moving sideways for more than two weeks after falling to a 15-month low at $1.9780 per lb, basis second position.
Benchmark Liffe May robusta futures were up $1 at $2,019 per tonne at 12:13 p.m., while May arabicas in New York dropped 2.60 cents to trade at $2.015 per lb.
Arabica futures have failed to garner any upward momentum since falling sharply in mid February, causing some chart-based dealers to sell, they said.
Coffee is facing pressure from expectations of a big crop in top producer Brazil.
"From May/June, you will have plenty of downward pressure on prices," Uhlenbrock said.
Comments
Comments are closed for this article.