Raw sugar futures finished on Tuesday near a six-week high on relentless fund buying and the market is seemingly poised to hurdle technical barriers in the coming days, brokers said. The New York Board of Trade's key March raw sugar contract climbed 0.17 cent to close at 8.87 cents a lb, dealing from 8.71 to 8.79 cents. It was the highest close for sugar on a spot basis since concluding at 8.90 cents on October 7. May sugar gained the same to 8.97 cents. The rest increased from 0.11 to 0.14 cent.
James Cordier, an analyst for Liberty Trading Group, said fund purchases sparked automatic buy orders once the March contract raced past 8.75 cents.
He said March is ready to probe the recent high of 8.90 cents then possibly challenge the psychological barrier of 9.00 cents.
"The funds covered it hard big-time. We're in the upper end of the range, but we need to go past 8.90 and then 9.00 (cents, basis March) if this will mean something," a dealer said.
Market fundamentals are turning a bit more bullish, especially with expectations of stronger consumer buying and a supply deficit forecast in the weeks and months ahead.
Technicians said they feel support in the March contract would be at 8.80 and then 8.49 cents. Resistance would be at 8.90 and 9.00 cents.
Traded volume just before the market closed hit 36,908 lots, from the previous 20,499 lots. Call volume at that time was at 4,419 lots while puts stood at 4,848 lots.
Open interest in the No 11 sugar market rose 1,117 contracts to 294,559 lots as of November 15.
Ethanol futures finished unchanged with the November contract settling at 104 cents a gallon. US domestic sugar prices settled higher Tuesday.
January sugar gained 0.25 to 20.55 cents a lb and March increased 0.17 to 20.53 cents. One contract aside, the rest were flat to 0.14 cent higher.
Traded volume before the market closed hit 1,127 lots from the prior 199 lots.