Raw sugar futures settled higher Monday on modest investor short-covering as the market rebounded from a fall last week to a 2-month low, brokers said. The March raw sugar contract rose 0.39 cent to conclude at 21.63 cents per lb. Traded from 21.24 to 21.79 cents. It was an inside day when compared to Friday's 21.18 to 22.96 band. March volume was at 35,872 lots at 2:00 pm EDT (1800 GMT).
Larry Young, an analyst for brokers Infinity Futures, said the market saw "a pause here." But sugar's fundamentals remain positive despite talk of the cancellation of some import orders by No 1 consumer India. "I still feel the fundamentals support higher prices," Young said, adding the market could easily reignite a rally and visit the highs around 25 and 26 cents, basis March.
Analysts said sugar is in consolidation, as can be gleaned from the inside day posted by the March contract. "We're really backing and filling," a dealer said, adding dealings were quiet due in part to the absence of players from Brazil, the No 1 producer and exporter whose markets were shuttered by a holiday there. On the demand side, brokers believe importers are waiting in the wings to see if values would slide toward the 20-cent area.
Technicians believe support in the March contract would be at 21 and 20.50 cents, with resistance at 24 and 25 cents. Volume traded Friday in the No 11 sugar market was at 137,970 lots, from the prior 153,118 lots - exchange data. Open interest in the No 11 sugar market was at 761,452 lots as of October 9, from the previous 770,546 contracts - exchange data.
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