New York sugar ends firm on consumers' demands

Raw sugar futures settled slightly higher on Tuesday on trade and consumer buying as the market recovered after easing recently to a three-week low, brokers said. The New York Board of Trade's March raw sugar contract gained 0.03 cent to close at 8.55 cents a lb., dealing from 8.52 to 8.65 cents. On Monday, the contract ended at 8.52 cents in the lowest finish for the contract since ending at 8.48 cents on December 16.
May sugar also gain 0.03 cent to 8.89 cents. Except for two contracts, the rest settled unchanged. Judy Ganes of commodity firm J. Ganes Consulting said sugar prices appeared set to stabilise in the days ahead after trade buying gave the sweetener a mildly positive sheen.
Traders said buying by the trade and small speculators pushed sugar to its highs for the session, but speculative accounts lightened up and the sweetener pared its gains.
The bulk of the trade buying was believed tied to suspect physical buying by countries like India. Some 100,000 to 300,000 tonnes were said to have been purchased, but further details were scanty, they said.
"You had some offtake come in and that helped the market," a trading house dealer said.
Sugar's outlook going forward was believed by most of the trade to be bullish due to a deficit in 2004/05 and stronger levels of consumer buying this year.
Sugar tumbled on Monday after funds liquidated their long positions and the open interest in the market seemed to reflect this move. Open interest in the No 11 sugar market sank 18,858 lots to 362,112 contracts as of January 10.
Volume traded before the market closed for the day stood at 32,148 lots, down from the prior tally of 79,660 lots. Call volume at that time was 5,845 lots and puts hit 4,755 contracts.
Ethanol futures settled unchanged with the February contract ending at 95 cents a gallon. US domestic sugar closed higher on Tuesday. March increased 0.03 cent to finish at 20.63 cents a lb. and may add 0.05 to 20.65 cents.
Except for one contract, the rest were flat to up 0.06 cent. Volume before the market closed was at 1,216 lots, up from 842 lots previously.