ICE raw sugar futures gained ground early Thursday, buoyed by speculative short-covering tied to further weakness in the US dollar and stronger crude prices, brokers said. "With the dollar off and crude up, we're finding some support," said one floor dealer.
Higher crude oil prices often provide a supportive influence for the sweetener amid belief that stronger crude prices will prompt producers to increase manufacturing of the alternative fuel ethanol, and eventually cut into the supply of cane for the sugar market.
The ICE Futures electronic May sugar contract was trading up 0.15 cent to 13.31 cents a lb by 9:18 am EDT (1318 GMT), moving between 13.10 and 13.41 cents. Trading volume Thursday in the electronic May sugar contract totalled 11,310 lots by 9:19 am.
In other news, soaring agricultural prices, growing demand for biofuels and the growth of the Chinese and Indian economies are leading top global investment banks to buy farmland in a bid to embrace the physical commodities market.