Raw sugar futures rose Tuesday to their loftiest level in almost three weeks in thin post-Christmas investor buying, with many major players in the softs complex away until after the New Year's holiday, analysts said.
With the London soft markets shut for a holiday, there was little if any interest in the complex, they said. Arabica coffee climbed but cocoa futures slipped lower.
The volume of business in US soft commodity markets ranged from 70 to 83 percent below the 30-day norm, Thomson Reuters data reported. ICE March raw sugar futures in New York were up 0.02 cent to finish at 23.61 cents a lb.
It was the highest settlement for the spot raw sugar contract since December 8, according to Thomson Reuters data.
"There's a general uplifting in commodities and softs were along for the ride," said The Price Group analyst Jack Scoville. He added that a weaker dollar also buoyed sentiment. "The softs are all quiet because London's closed. There's not much interest there today because they're not open," Bill Raffety, senior analyst for futures brokerage Penson Futures, said.
The raw sugar market is on track to be the third worst performing commodity in 2011, having fallen sharply since reaching a 30-year peak around 36 cents a lb earlier in the year.
Scoville said the weaker performance of sugar is to be expected since the situation has changed markedly in 2011 from what it was in 2010. In 2010, a poor crop forced No 2 world producer India to be a heavy importer of sugar. This year, India has reverted back to its usual role of exporting sugar.
Arabica coffee futures moved higher in range-bound dealings, lifted by the firm commodity complex and weak US dollar, dealers said.
New York's March arabica futures rose 3.20 cents or nearly 1.5 percent to settle at $2.2285 per lb. The New York coffee market is on track to end 2011 down roughly 9.0 percent, compared to the 77 percent surge it posted in 2010.
US cocoa futures reversed higher in thin holiday dealings after the key March contract touched a session low of $2,186 a tonne, jumping nearly $50 within 10 minutes during the session in a surge that involved less than 400 lots.
"It moved $50 on nothing in 10 minutes. It's light volume and some resting orders just got hit," said Raffety. "It's light. With Europe not trading, these guys are able to move it. We're between Christmas and New Year's."
New York's March cocoa contract slipped $2 to close at $2,216 per tonne.