Raw sugar futures bounced to a firmer finish on Wednesday, albeit in thin holiday volumes, as prices received a technical boost after an overnight test of underlying support held, brokers said. ICE agricultural futures traded an abbreviated session on Wednesday and will be closed on Thursday, December 25, for the Christmas Day holiday.
The key March raw sugar contract ended up 0.17 cent at 11.02 cents per lb Trading ranged from 10.81 to 11.04 cents. Volume traded in the March contract slowed to 6,802 lots at 1:33 pm EST (1833 GMT). May sugar gained 0.14 cent to close at 11.65 cents. Boyd Cruel, senior softs analyst with Alaron Trading in Chicago, said sugar found some technical support at around the 10.75 level, after trading down to 10.81 overnight.
"We're going to have some resistance at 11 cents. I think the upside will continue to be limited, especially with crude oil prices moving lower." Cruel added. Brokers Sucden said index fund rebalancing over the next month is likely to reduce the fund long position and weigh on raw sugar prices.
"This could put both the flat price and the front month spreads under further pressure and could well lead to a test of the 10.00 (cents a lb) area and possibly a quick look at some lower numbers," Sucden said in a daily market report. The domestic No 14 sugar market showed the March contract down 0.03 cent at 20.00 cents at 1:39 pm.