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NEW YORK (Dow Jones)--World raw sugar futures rose Wednesday on the New York
Board of Trade after the front months entered an overhead gap in a late surge,
reaching the highest levels in four sessions. March/May rolling was active
before the front month expires on Feb. 28.
Trade houses bought the nearby switch, while funds sold it.
The March contract settled 20 points higher at 17.92 cents and May closed up
22 points at 18.12c.
"We opened lower but trade buying supported it," a floor broker said. "March
turned around,otnihigher ground, but stalled at 17.80c." Most-active May
stalled at 18.01c.
"The market chopped on both sides of unchanged for awhile in March-May
rolling," the broker observed. "It was quiet until May got through a big number
when it cleared 18.10c at the end," touching stops and entering a gap.
March scaled the 18.00c barrier, reaching 18.02c.
Funds and small speculators stood net long 108,000 lots on the close, a desk
trader calculated.
The March/May spread worked at March 14 to 23 points under and closed at 20
points under after settling at 18 points under on Tuesday.
Some 3,515 against actuals were posted in March and 2,392 in May.
Futures volume was estimated at 60,100 lots. In the options ring, 10,007
calls and 11,423 puts traded.
March recently eased from a 25-year high of 19.73c a pound during pre-expiry
liquidations. Sugar is a food and energy crop, and crude oil prices have backed
down in recent weeks.
The sugar market remains underpinned however by forecasts for global
inventories to be drawn down in 2005-06 for the third straight season.
Iraq tenders Friday to buy 12,500 to 25,000 metric tons of white sugar, the
State Foodstuff Trading Co. said. Iraq recently rejected offers in a tender for
up to 300,000 tons. The nation buys 700,000 tons of foreign whites yearly,
according to the Trade Ministry.
Meanwhile, Egyptian officials say they have up to nine months worth of
stocks to fall back on, and are in no rush to buy foreign sugar. The nation
imports an average of 1 million tons of sugar yearly.
On Thursday, Trading Corp. of Pakistan tenders for 50,000 tons of whites for
mid-March arrival. Meanwhile, Indian mills have sold more than 10,000 tons of
whites to Pakistan, an industry official said Monday. Indonesia's Bulog shopped
for white sugar last week and may have bought 55,000 tons of Thai origin.
Vietnam has sugar to buy this spring.
Australian sugarpuorgCSR Ltd. (CSR.AU) said Wednesday it approved a A$15
million project for fuel-ethanol production at its Sarina distillery in
Queensland. Raw ethanol currently produced at Sarina is reprocessed to
fuel-grade material at the company's Melbourne facility. "CSR sees itself as a
major player in the growing fuel-ethanol industry," CSR ethanol manager Gavin
Hughes said.
Nybot March finds support at 17.55, 17.52, 17.50, 17.48 and 17.45 cents and
faces resistance at a gap at 18.02 to 18.10, 18.12, 18.15 and 18.20.
May confronts resistance at the rest of a gap at 18.19-18.20, 18.22, 18.25,
18.27 and 18.30 cents.
The Nybot will be closed Monday for Presidents Day.
Nybot Change Range Liffe Change
Mar 17.92 up 0.20 17.55-18.02 May 443.80 up 0.30
May 18.12 up 0.22 17.70-18.19 Aug 442.60 up 0.10
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