May cocoa on Liffe ended 10 pounds higher at 2,341 pounds, boosted by the weakness of sterling. Market closing in on 32-year peak of 2,356 pounds set on Thursday. March white sugar ended $12.00 lower at $747.00 a tonne. Market awaits confirmation that physical buyers are willing to current high prices before possibly mounting another challenge to record peak of $767.00 set earlier this week.
March robusta coffee settled $33 higher at $1,360 per tonne, moving back towards the middle of its current trading band after finding support towards the lower end of the range. Dealers also said technically-based selling had emerged on disappointment over the market's failure on Thursday to breach the 30 cents a lb level on March ICE raws to reach 29-year highs.
The market remains underpinned by tight supplies and the prospect of strong demand from a wide range of key importers including Pakistan, Egypt, Mexico and Indonesia although little business has yet been conducted. "We need to see demand connect with the market at current levels for us to take the next step through 30 cents," said James Kirkup, director and head of sugar brokerage at Fortis Bank Nederland in London.
"Sugar is still fundamentally the most tight commodity of them all. It has still got some upside legs," said commodity strategist Kona Haque of Macquarie Bank. The contract rose as high as 29.82 cents on Thursday, a 29-year high for the benchmark month, but just shy of the 30-cent level which is seen by many as the next upside target for a commodity which more than doubled in value last year.
Obama on Thursday threatened to fight Wall Street banks with new proposals to limit financial risk taking, sending US bank stocks tumbling. "It (the Obama proposal) is clearly negative for all markets but I think what we have got to remember is that for it to happen it is going to take years. It doesn't suddenly make March (raws) bearish," Kirkup said. But dealers said sugar remained underpinned by tight supplies and strong demand from a number of key importers.
Comments
Comments are closed.