Sugar Falls to Eight-Week Low on Ample Supply
(Bloomberg) – Sugar fell to the lowest level in eight weeks in London as exports from India, the world’s second-largest producer, will compensate for a delay to the crop in top grower Brazil. Coffee advanced.
India has allowed exports of 3 million metric tons as local supplies are higher than demand. The harvest in Brazil, which usually would have started by now, will begin later this month or in early May, according to Cepea, a University of Sao Paulo research group. The sugar cane crop in Brazil’s main growing region will be 500 million tons, down from a previous forecast of 520 million tons, Macquarie Group Ltd. estimates.
“The market finally discovered that the April and June sugar trade flow is not as tight as was expected,” Naim Beydoun, a broker at Swiss Sugar Brokers in Rolle, Switzerland, said in a report e-mailed yesterday. Delays to the harvest and a smaller crop in Brazil are not “important to the world market”as Indian exports “will be there to fill the Brazilian gap.”
White, or refined, sugar for August delivery slid 0.8 percent to $616.20 a ton by 10:36 a.m. on NYSE Liffe in London, after touching $616 a ton, the lowest since Feb. 15. Raw sugar for July delivery was little changed at 23.12 cents a pound on ICE Futures U.S. in New York.
Sugar has fallen 4.1 percent in London and 2.8 percent in New York this month as a forecast surplus becomes available to the market. The commodity rose 6.9 percent on NYSE Liffe and 2.2 percent on ICE in the first quarter on speculation supplies would be limited due to the crop delay in Brazil.
The sugar cane crop in Thailand, the second-biggest sugar exporter, may be near 104 million tons, “exceeding all expectations,” Beydoun said in the report.
Robusta coffee for July was up 0.7 percent to $2,004 a ton on NYSE Liffe. Arabica coffee for May delivery rose 0.9 percent to $1.7975 a pound on ICE.
Cocoa for July delivery was little changed at 1,387 pounds ($2,204) a ton in London. Cocoa for May delivery climbed 0.2 percent to $2,075 a metric ton in New York.
To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.