Premiums for Thai sugar edged up but trade remained muted in the region after nearly a million tonnes of the raw variety were delivered against the ICE Futures US March contract that expired on last Friday, dealers said. Large global traders ED&F Man Capital Markets Investor and Sucrees & Denrees (Sucden) bought 1.02 million tonnes of raw sugar, the largest March delivery against the contract since at least 1989, according to ICE data.
Dealers believe that some of the unexpectedly large volumes will head to Asia. "There were no deals at all because we believe that some of the 1.02 million tonnes of sugar delivered against the March expiry will find its way to the Asian buyers," said a dealer in Singapore. Fresh demand will likely spur trade deals in about another week, the dealer said.
The widely traded high polarisation or hipol raws, were offered at 50 points above the front-month New York contract, up from 35 points in the past week. On Wednesday, ICE May raw sugar futures ended down 0.11 cent, or 0.8 percent, at 13.34 cents a lb, after touching the lowest since May 2010 at 13.18 cents. The premium for J-spec, the low-quality Thai raws favoured by Japanese buyers, was quoted at 45 points above the New York contract, up from 30 points from the previous week.
Thai white sugar premiums were at $15 a tonne to London futures, down from $19 last week. Although there no trade deals for Thai sugar, India contracted to export 50,000 tonnes of raw sugar in its first overseas sale of the season that started in October. The Indian government has issued an official order to give its money-losing sugar mills an incentive of 4,000 rupees ($64) a tonne to export up to 1.4 million tonnes of the raw variety.