Raw sugar futures crumbled from a late bout of profit-taking and investor liquidation to end lower Friday, although bullish fundamentals pared the market's losses, brokers said. The key October raw sugar contract sank 0.58 cent to finish at 21.21 cents per lb. October traded between 20.92 to 22.38 cents.
October contract volume reached 66,813 lots at 2:07 pm EDT (1807 GMT). March sugar dropped 0.56 cent to settle at 22.86 cents. Sugar crashed on late profit-taking and fund liquidation after climbing steadily the past week, with losses likely limited by the market's bullish fundamentals.
Analysts point to problems plaguing the cane crop in top producer and exporter Brazil, along with expected sizeable imports by top consumer India, the analysts said. Bullish factors are still abundant in the sweetener and this could spur the market toward higher ground in the weeks ahead, analysts said.
Alex Oliveira, sugar analyst for Newedge USA in New York, said harvesting in the premier center-south cane region of Brazil was "way behind schedule." This would raise the prospect that some of the remaining cane could be plowed under, he said. Estimates of imports by India are rising by the day. The country has contracted sugar imports of 4 million tonnes this year and is expected to purchase 4 million to 5 million tonnes in 2009-10.
Technicians peg resistance in the October contract at 23 and up to 24.85 cents, with support at 20.50 and 20 cents. Volume traded Thursday in the No 11 sugar market was 171,825 lots, down from 192,311 lots - exchange data. Open interest in the No 11 sugar market was 832,473 lots as of September 10, down from the previous 841,630 contracts - exchange data.
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