Raw sugar futures settled Friday near a four-month high on investor and consumer buying, with analysts saying the key March contract may take aim at the key 13 cents area in the days ahead. The key March raw sugar contract rose 0.32 cent to end at 12.70 cents per lb.
On a spot basis, it was the highest close for sugar since early October. Trades spanned 12.23 to 12.84 cents. Volume in March reached 52,369 lots at 2:20 pm EST (1920 GMT). May sugar rose 0.30 cent to close at 12.94 cents. "If we get above 13 (cents), we're going to see a pop here," said Larry Young, an analyst for brokerage Infinity Futures in Chicago.
He said there seems to be a lot of congestion near 13 cents from producer sales and investor profit-taking. Some analysts said sugar was also getting a boost from possible buying by India, one of the world's top consumers of sugar. This was underscored by news that India's state-run trading firm MMTC Ltd issued a tender to import 22,000 tonnes of raw sugar, with the deadline for bids January 30.
Some analysts believe the price of sugar should grind higher, given the increasing deficit in the market. Technicians feel resistance in the March contract at 13 and 13.50 cents, with support at 12 and 11.50 cents. Volume traded Thursday in the No 11 sugar market reached 74,133 lots - exchange data.
Open interest for No 11 sugar market was at 661,626 lots as of January 22, down from the previous tally of 661,998 lots. In the domestic No 14 sugar market the March contract fell 0.10 cent to 20.15 cents at 2:22 pm volume on Thursday in the No 14 market stood at 462 lots - exchange data.