Raw sugar futures on Friday posted their highest close in four months on investor buying and news of falling output in Asia and Europe, though profit-taking pruned some gains late. The key March raw sugar contract settled up 0.14 cent or 1.07 percent at 13.12 cents per lb. On the spot daily charts, it was the highest close for sugar since nearly 14 cents at the start of October.
Trades spanned from 12.93 to 13.25 cents. Volume traded in the March contract reached 61,202 lots at 2:07 pm EST (1907 GMT). May sugar added 0.11 cent to conclude at 13.42 cents. Commodity analyst F.0. Licht said lower Asian and European production meant sugar will move from surplus to deficit in 2008-09 as output will not match demand for the first time in three years.
Jack Scoville, vice president for brokers the Price Group in Chicago, said the forecast of short crops boosted the market. He said the sweetener is "breaking out to the upside on the charts so they (are) looking bullish for a nice move up next week." Traders said, once the March contract broke past recent resistance at 13.05 and 13.07 cents, automatic buy orders propelled it ever higher. But Licht cautioned that more sugar may be harvested by Brazil while high prices in Pakistan and India may inspire increased plantings there.
"This could mean that the currently constructive fundamental picture for a rise in sugar prices may be more short-lived than it appears at first sight," Licht said. Technicians put resistance in the March sugar contract at 13.20 and up to 13.50 cents, with support at 12 and 11.50 cents. Volume traded Thursday in the No 11 sugar market reached 134,919 lots - exchange data.
Open interest for No 11 sugar market was at 665,916 lots as of February 5, from the previous tally of 664,275 lots. The domestic No 14 sugar market showed the March contract up 0.90 cent at 19.85 cents at 2:08 pm volume on Thursday in the No 14 market stood at 71 lots - exchange data.
Comments
Comments are closed.