Sugar climbed to the highest level in more than five months in New York as the main growing region of top producer Brazil will make less of the sweetener than previously forecast. Cocoa slid and coffee advanced.
Millers in Brazil’s center south will make 34.2 million metric tons of sugar in the 2013-14 season started there in April, Sao Paulo-based industry group Unica said yesterday. That’s down from a previous forecast of 35.5 million tons. Rains earlier this year reduced yields. Sugar gained 11 percent last month amid rising demand forecasts and lower output.
“Brazilian harvest results confirmed expectations of ailing ATR levels, or sugar content in the cane,” Tracey Allen, an analyst at Rabobank International, said in a report e-mailed today. Sucrose content is at the “bottom end of the five-year range,” limiting sugar and ethanol production, she said.
Raw sugar for delivery in March gained 0.8 percent to 18.47 cents a pound by 8:52 a.m. on ICE Futures U.S. in New York. The price touched 18.56 cents a pound, the highest for a most-active contract since March 18. Futures trading volumes were 31 percent higher than the average for the past 100 days for this time of day, according to data compiled by Bloomberg. White sugar for December delivery rose 0.8 percent to $492.50 a ton on NYSE Liffe in London.
Raw sugar fell 5.3 percent this year and is heading for a third annual decline, the longest losing streak since 1992. Supplies were 10 million tons higher than demand last season, estimates the International Sugar Organization in London. Another surplus of 5.4 million tons is forecast for the 2013-14 season, according to Rabobank.
“Longer-term global sugar fundamentals remain comfortable,” Allen said, forecasting ending stockpiles at a record 76.9 million tons in 2013-14 as consumption gains 2 percent.
Louis Dreyfus Commodities took the biggest delivery of raw sugar on record on ICE to settle the expiration of the October futures, according to two people familiar with the purchase. The Rotterdam-based trader owned 29,344 futures when the contract expired on Sept. 30, said the people, who asked not to be identified because the transaction is private. That’s equal to 1.49 million tons of sugar.
Arabica coffee for December delivery rose 0.3 percent to $1.144 a pound in New York. Robusta coffee for delivery in November gained 0.8 percent to $1,649 a ton in London.
Cocoa for December delivery fell 0.2 percent to $2,630 a ton on ICE. Cocoa for delivery in the same month slid 0.2 percent to 1,687 pounds ($2,734) a ton on NYSE Liffe.