London sugar futures closed firmer on Friday on trade short covering in moderate volumes, traders said.
Front month August closed up $1.7 at $220.4 a tonne, having moved between $221.5 and $217.5, in volume of 1,938 lots.
October closed up $0.9 at $224.4 in volume of 886 lots.
"The market is moving up on trade short covering, but there is little trace of any arbitrage between London August and New York July, where the premium now stands at $64," one trader said during afternoon trade.
Another trader said, "We have seen trade buying, but volumes are not particularly big. Activity was dull until the last half hour of the session when speculative buying in New York helped the London market."
Traders also noted light spread activity between the London August and October contracts at a tighter spread of $4.
Earlier in the session, London sugar futures had inched lower on trade and producer selling and profit taking, traders said.
Traders expected LIFFE whites to remain in a range between $215 and $224.
"I see very massive support in London at $215," one trader said.
Worries over rains delaying the Brazilian harvest would continue to underpin the market in the days ahead, they said.
Brazilian sugar prices firmed as persistent rains delayed the centre-south sugarcane harvest, traders in Brazil said on Friday.
On Thursday, buyers bid between 23 and 23.50 reais per 50-kg bag of 150 ICUMSA white sugar, against selling offers of 24 to 25 reais. Last week it traded at 22-22.50 reais a bag.
In fundamentals, Mauritius sugar production is expected to rise to about 590,000 tonnes in 2004 from 537,155 last year, the Mauritius Chamber of Agriculture said in its annual forecast on Friday.
Comments
Comments are closed.