New York sugar settles at five-week low

Raw sugar futures closed on Thursday at a five-week low on sustained speculative sales and the market may punch lower due to the prospect of bumper supplies and what, so far, is lacklustre demand, brokers said.
The New York Board of Trade's May raw sugar contract fell 0.18 cent, or 1.7 percent, to finish at 10.23 cents per lb, dealing from 10.18 to 10.50 cents. On the spot daily charts, it was the lowest close for sugar since ending at 10.12 cents on February 7. July dropped 0.15 to 10.13 cents.
The rest lost from 0.10 to 0.15 cent. In the IntercontinentalExchange's NYBOT electronic market for sugar, its May contract declined 0.14 to 10.27 cents at 12:58 pm EDT (1658 GMT), moving from 10.50 to a new contract low of 10.19 cents.
"We'll probably take a peek at that level just under 10 (cents, basis May), but if we hold, we're going the other way," a long-time floor analyst said. Longer-term, traders said sugar will struggle this year from a global surplus. The market took note of recent news from German commodity analyst FO Licht that prices could fall below 10 cents due to a rise in output in top grower Brazil and leading consumer India.
Futures popped up to the highs for the day at the onset of trade, but speculative sales took over and kept the market on the defensive the rest of the session, dealers said. "We had some trade support come in at the lows, but momentum accounts for a lot in here so we could see it probe lower tomorrow," one said. Technicians feel support for the May contract in the open-outcry pit at 10.13 and 10 cents, while resistance was at 10.58 and up to 11 cents. Open interest in the No 11 raw sugar market surged 4,648 lots to 652,472 contracts as of March 13.
Volume traded around noon stood at 18,142 lots, from the prior open-outcry count of 14,063 lots. Call volume was 15,625 lots and puts at 8,189 lots. NYBOT said on Wednesday's electronic volume was at 42,015 lots and total volume at 56,078 lots. No deals were done in the ethanol market.
US domestic sugar prices ended mixed. The May contract rose 0.06 cent to 20.83 cents per lb and July was flat at 20.73 cents. One contract aside, the rest retreated 0.10 to 0.23 cents. The electronic No 14 sugar market saw its May contract gain 0.08 cent to 20.85 cents at 12:59 pm.