Sugar Prices Rise on Expectations of Lower Production

June 16th, 2016


Category: Sugar

Sugar TRQ(Nasdaq) – Sugar prices closed higher for the first time in four sessions as traders await news about the pace of sugar production in Brazil.

Raw sugar futures rose 2.2%, to end at 19.76 cents a pound, on the ICE Futures U.S. exchange.

James Liddiard at Agrilion Commodity Advisers said in a note that rain delays have analysts estimating between three and five days of lost production.

“The general expectation is for a somewhat dramatic fall,” he said.

S&P Global Platts said it expects the industry association will release the results on Thursday. Unica recently altered its schedule for releasing the results, adding days of delay. That has some traders relying more heavily on survey data ahead of the release.

Analysts at Kingsman, a unit of S&P Global Platts, are forecasting a cane crush of 33.9 million metric tons and analysts surveyed by the firm are expecting a 21% drop from a year ago to 32.15 million metric tons.

Helping boost sugar prices, the contract has the greatest number of net bullish bets ever as of last Tuesday, according to data from the U.S. Commodity Futures Trading Commission.

In other markets, cocoa for September ended up 0.4% at $3,116 a ton, arabica coffee for September rose 2.2% to close at $1.401 a pound, frozen concentrated orange juice futures for July fell 0.8% to close at $1.624 a pound and December cotton dropped 0.5% to close at 63.62 cents a pound.

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