Thai sugar premiums for shipments in early 2005 are expected to stay steady over the next few days on expectations of overseas demand, including from Indonesia, traders said on Monday.
"Many international trading firms have been seeking to buy Thai sugar for January-March shipment," said an official at one large exporting firm.
Thailand is one of Asia's major sugar exporters. Its key buyers are Japan, South Korea, Taiwan, Indonesia and Malaysia.
Indonesia, one of the world's biggest sugar buyers and the main buyer of Thai sugar, importing around 1.3 million tonnes a year, both raws and whites.
Offers for Thai 100 ICUMSA white sugar premiums for January-March 2005 shipment were steady at $13 over London prices with no bids on Monday.
ICUMSA measures the colour of sugar and the lower the ICUMSA level, the higher the degree of whiteness. ICUMSA 100 is considered consumer-grade sugar.
Only a handful of exporters have offered to sell sugar from the coming 2004/05 crop to international trading firms under forward agreements for 2005 shipment, traders said.
"At this stage, when the next crop is not very clear. I do not think Thai exporters want to sell any," said one trader.
There has been ample rain over the past two months in most sugar cane growing areas and traders expect 2004/05 (October-September) cane production of between 58-61 million tonnes, down from 64.48 million tonnes in 2003/04.
Some cane in the north-east, which produces about 40 percent of Thailand's crop, has been damaged by drought.
The harvest season for cane crop usually starts in October.
There was talk that the Indian government was considering to import up to 2.5 million tonnes of raw sugar, traders said.
"There is general expectation that India is likely to import between 2.5 to four million tonnes between the end of this year and next year," said one Indian trader.
"But I do not think the government is considering it at this stage."
Traders expect India, the world's largest sugar consumer, to import up to five million tonnes over the next two years on expectations of a considerable fall in domestic production.
"Now, with the monsoon has arrived, I expect imports to go down. India is expected to import, but not for immediate arrival," said another trader.