New York sugar finishes mixed as market takes breather

Raw sugar prices settled mixed on Friday as the market was content to consolidate after its rally to near eight-year highs this week, brokers said.
The New York Board Of Trades benchmark March raw sugar contract slipped 0.07 cent to end at 11.98 cents a lb., dealing from 11.93 to 12.12 cents.
May sugar shed 0.04 cent to 11.88 cents. Except for one contract, the rest increased from 0.02 to 0.08 cent. "We could lose a little more ground, but that would be healthy. Overall, we're still in position to go higher and it looks like the next target is 12.50 (cents, basis March)," a long-time floor dealer said.
Most operators said a pullback would be healthy for the sweetener because the market is heavily overbought following its surge to levels last seen in 1998.
The fundamentals have not changed much though. Supplies are tight due to the rising use of cane into producing the biofuel ethanol. Consumption remains robust and this would put further pressure on supplies, the analysts said.
Trade house Czarnikow Sugar said the world sugar deficit would narrow to 3.03 million tonnes in 2005/06 from 3.94 million in the preceding season.
Futures edged up to highs for the day, but the advance soon sputtered as sales by the trade and small speculators depressed the market, dealers said.
"You had some selling from the trade and the locals jumped in front to take some cash off the table going into the weekend," one said. Volume traded before the close of business stood at 30,249 lots, versus the previous tally of 41,117 contracts. Call volume hit 9,344 contracts and puts amounted to 2,623 lots. Technicians said they feel resistance for the March contract would be at the January 1998 high of 12.22 cents and then 12.25 cents.
They pegged support at 11.91 and then the area of 11.85/86 cents. Open interest in the No 11 raw sugar market rose 3,511 lots to 486,630 lots as of November 17.
There were no trades in the ethanol market. US domestic sugar prices ended higher. The January contract rose 0.12 cent to 22.12 cents a lb. and March added 0.03 to 21.73 cents.