LONDON: Raw sugar futures rose to their highest level in almost two weeks on Thursday, boosted by fund short-covering and potential further downward revisions to Brazil’s production prospects. SUGAR
July raw sugar was up 0.05 cents, or 0.4 percent, at 11.66 cents per lb at 1335 GMT after peaking at 11.70 cents, the highest for the front month since May 4.
Dealers said the market was underpinned by dry weather in top grower Brazil and the continued switch to using more cane for ethanol rather than sugar production.
“It seems for the first time since the end of Feb there has been a potential ‘story’ for the sugar bulls,” said Thomas Kujawa, co-head of the softs department at Sucden Financial. “However, the continued dry weather forecasts will have to persist for some time to come before we witness a consensus shift and further negative Brazil crop revisions,” he added.
Dealers said the market’s improved recent performance had also led to a more constructive outlook on price charts, prompting funds to trim short positions.
August white sugar rose $4.80, or 1.5 percent, to$327.30 a tonne.