CSCE raw sugar futures finished near the top of the range on Thursday, with some talk of physical buying supporting the downside, but large crops expected to keep a cap on the upside, traders said.
"It's a bit range-bound at the moment. We're not really seeing any fundamental changes. We're waiting to see if Brazil's overhanging the market in a big way. Before we have a good handle on what's going on in Brazil, I don't think the market will move aggressively one way or the other," said one sugar broker.
He added that record-high freight rates seem to be easing, "That may help with some offtake (of physical sugar), which in turn should help prices recover some."
The active July contract rose 0.30 cent to end at 7.03 cents, in a range running from 6.72 to 7.05 cents lb. May sugar firmed 0.23 cent to close at 6.63 cents a lb., in a 6.32 to 6.63 cents trading band.
The rest of the board ended 0.20 to 0.24 cent higher. Final traded volume reached 42,315 lots against 85,952 lots on Wednesday. Call volume was 10,490 lots, with puts at 3,256 lots. Open interest in the sugar 11 market rose by 4,492 to 279,835 lots as of April 28.
At this point, dealers said the trading has mostly been based on technical. "There have been various attempts to go to the 7 cents (a lb. on July sugar futures) area, and it doesn't really want to go there.
It seems there's a lot of resistance around 7 cents," said one trader. Technicians said they expect the range to be confined to around 6.40 cents on the downside, with the contract high hit on Wednesday at 7.30 cents as resistance.
May sugar expires on Friday, and traders said they expect deliveries of physical sugar against May futures to be light. Open interest in the May contract stood at 8,282 lots on Thursday.
US domestic sugar prices finished mostly lower on Thursday. July sugar was down 0.02 cent at 20.88 cents a lb., while September was 0.02 lower at 21.03 cents. Prices on back months ended down 0.04 to up 0.01 cent.
Final estimated volume in sugar 14 amounted to paltry 44 lots, compared with 35 lots previously. The CSCE is a subsidiary of the New York Board of Trade.