Raw sugar prices rose on Tuesday and ended at their highest level in nearly eight years due to heavy buying by funds betting supplies will stay tight amid rising demand for biofuels and robust consumption of the sweetener, brokers said.
Investors who control large pools of money are betting sugar prices will rise further because of the steady diversion of cane into producing the biofuel ethanol.
The New York Board of Trade's benchmark March raw sugar contract soared 0.29 cent or nearly 2.50 percent to settle at 12.04 cents a lb., just a hair below its new contract high of 12.05 cents. The day's low was at 11.79 cents.