Raw sugar futures settled near session highs Thursday on trade and speculative buying as traders waited for news to provide the market with direction on its next move, brokers said.
The New York Board of Trade's May raw sugar contract increased 0.09 cent to close at 16.88 cents a lb., in a band from 16.46 to 16.93 cents. July rose 0.11 to 16.60 cents. The rest added from 0.15 to 0.20 cent. "We're taking a break, but it's been chop city again," a long-time floor broker said.
Analysts said trade accounts supported sugar at its low for the day, when small speculators sought to press the market lower at the start of business.
"The trade is still generally bullish on the market, but the (commodity) funds who had driven this higher are standing aside," an investment house analyst said.
Fundamentally, the market was still facing a shortfall in supplies. Uncertainty was hovering as to how much cane will go into ethanol production in top grower Brazil.
Consumer buying from Russia and Asia was seen staying strong and there were questions about how much the United States, whose cane crops have been hit recently by storms and drought, will import this year.
"We've pulled back a little bit from the rally, but there is still a lot of strength in sugar," a dealer said.
Technical analysts felt resistance in the May contract was at 17 and 17.50 cents, with support at 16.45/50 and 16 cents.
Volume before the end of trade hit 28,955 lots, down from the previous tally of 49,763 contracts. In the options ring, call volume hit 10,616 contracts and put volume was 4,390 lots. Open interest in the No 11 raw sugar market fell 5,868 lots to 458,458 lots as of March 1. No trades were done in the ethanol market.
US domestic sugar prices ended higher. The May contract went up 0.35 cent to 22.84 cents a lb., while July gained the same to 22.85 cents. The rest were flat to up 0.30 cent.
Volume done before the close stood at 408 lots, compared with the previous 165 lots.