Raw sugar prices settled mixed on Wednesday with small speculators giving nearby contracts a mild boost and most players betting the sweetener could rally on fund buying after the New Year holiday break, brokers said.
The New York Board of Trade's benchmark March raw sugar contract increased 0.06 cent to close at 14.61 cents a lb, dealing from 14.36 to 14.63 cents.
May sugar rose 0.02 to 14.66 cents. One contracts aside, the rest slipped by 0.01 or 0.02-cent. Steve Platt of Archer Financial Services in Chicago said sugar prices could slip in the days ahead as the market gives back some of its gains after its recent rally.
But he added that sugar could rally after New Year when funds that have been a prime driver of the rally return in force after the holiday.
The sugar market is closed on Monday for New Year.
Trading reopens on Tuesday. Sugar has rallied strongly due to a slew of bullish fundamental factors. They include the diversion of cane into producing the bifocal ethanol in leading grower Brazil, the prospect of a cut in supply from Europe due to EU sugar regime reforms, and the activity by the funds.
Sugar opened at its highs for the day, but speculative liquidation deflated the market, floor brokers said. "The selling dried up and the trade came running back in.
The locals then got us back to the highs. We may hang around here, but we may see this rally next week when the big boys come back," a broker said.
Technicians see resistance in the March contract at 14.90 and 15 cents, with support at 14.50 and 14 cents. Open interest in the No 11 raw sugar market fell 830 lots to 532,810 lots as of December 27.
Volume before the close stood at 31,451 lots, from the previous tally of 17,589 contracts. Call volume reached 4,231 lots and put volume amounted to 8,391 lots.
The ethanol market was mostly unthreaded. US domestic sugar prices ended flat to firmer. March rose 0.10 to 22.20 cents a lb. and May added 0.15 to 22.10 cents.
The rest were flat to up 0.06 cent. Volume before the close hit 524 contracts, from 102 lots previously.
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