CSCE raw sugar futures ended on Tuesday near a 10-month high on robust speculative fund buying, fears that rains in Brazil could hinder the harvest and livelier interest in the cash market, analysts said.
CSCE July sugar surged 0.16 cent to settle at 7.22 cents a lb, moving from 6.99 to 7.25 cents. On a spot daily basis, it was the best close for sugar since concluding at 7.28 cents on August 6, 2003. October jumped 0.20 to 7.52 cents. The rest increased 0.08 to 0.12 cent.
James Cordier, a broker for Liberty Trading Group, said a steady barrage of speculative buying kept values buoyant coming out of the holiday weekend and this may augur well for a further advance in the sweetener.
The sugar market was shut Monday for US Memorial Day.
"The specs just kept piling in," a floor dealer said.
Fund buying could further boost futures, especially if rains eventually reduces the amount of sugar that can be crushed in Brazil's vital center-south cane crop, which accounts for up to 85 percent of the country's sugar output.
"We had pretty good producer selling in (the October contract) when it got up to 7.30 cents," a dealer said in alluding to sales by Thai and Brazilian sugar exporters.
Technicians feel resistance in July would now be at 7.25 and 7.28 cents. They said support should be at 7.00 and then 6.80 cents.
Final estimated volume was at 53,293 contracts, down from the previous count of 54,693 lots. Call option volume was 7,313 lots and put volume was at 5,192 lots. Open interest in the No 11 sugar market rose 6,258 lots to 272,957 lots as of May 28.
Ethanol futures settled softer. June ethanol eased 0.20 cent to 79.80 cents a gallon. The rest shed 0.20 cent. Open interest in the ethanol market rose 14 to 295 lots as of May 28. Friday's trading volume hit 18 lots.
US domestic sugar prices ended mixed Tuesday.
July sugar fell 0.10 cent to 20.20 cents a lb while September was flat at 20.47 cents. Except for two contracts, the rest shed 0.01 to 0.06 cent. Final traded volume was at 368 lots against the previous 366 lots.