Raw sugar futures on ICE rallied on Tuesday, boosted by data showing higher-than-expected ethanol production from cane in top grower Brazil, while New York cocoa prices fell on pressure from the weak British pound against the US dollar.
October raw sugar settled up 0.13 cent, or 1.06 percent, at 12.45 cents per lb, after rallying 2.7 percent to 12.65 cents. Prices extended gains after data showed Brazilian center-south mills produced 1.44 billion liters of hydrous ethanol in the first half of June, data from cane industry group Unica showed.
This was the highest volume for the two-week period since August 2010, as strong demand due to a price advantage over gasoline continued to boost output. This ethanol is made from cane, leaving less available for sugar production than expected, traders said.
"This should keep the split much more in favour of ethanol," one US trader said. Open interest in July fell by 8,314 lots to 62,682 on Monday, ahead of its expiry on Friday, ICE data showed. August white sugar settled up $4.90, or 1.4 percent, at $350 per tonne.
Dealers said the spot contract was supported by tighter nearby trade flows, despite a looming global supply glut of white sugar in part due to a lack of exports from India, where domestic prices remain above the world market. September robusta coffee settled up $10, or 0.6 percent, at $1,686 per tonne.
The July premium over September closed at $10 versus $2 on Monday, which spurred buying interest, dealers said. Prices were also partly supported by a slowdown in selling by producers in top grower Vietnam, they said. "The Vietnamese have slowed down a bit, with the market below $1,700," one European dealer said.
September arabica coffee settled up 0.5 cent, or 0.4 percent, at $1.177 per lb, tracking gains in robusta coffee. September New York cocoa settled down $8, or 0.3 percent, at $2,472 per tonne. Total open interest rose for the fifth straight session on Monday, ICE data showed.
Prices were pressured by the weak pound, traders said. September London cocoa settled down 5 pounds, or 0.3 percent, at 1,804 pounds per tonne. The July London premium over September closed at a premium of 23 pounds, down from Friday's high of 42 pounds.
Comments
Comments are closed.