08/04/10 – White sugar rose in London on speculation that a drought in China will result in reduced supplies and spur importers to boost stockpiles.
China, the world´s second-largest sugar consumer after India, may bolster imports as output declines because of reduced acreage of sugar beet and the impact of drought in Yunnan province, Rabobank International said.
Output may drop to 12 million metric tons this crushing year, from 12.5 million tons a year ago, Rabobank analyst Lief Chiang told reporters in Shanghai today. The forecast includes beet and cane sugar.
White sugar for August delivery advanced $7.10, or 1.6 percent, to $462.70 a ton on the Liffe exchange in London.
Sugar prices more than doubled last year as excess rains in Brazil and a weak monsoon in India curbed output in the world´s biggest sugar-cane growers. That spurred demand from importing nations from Egypt to Mexico.
Trading Corp. of Pakistan invited bids for the import of 200,000 tons of white sugar and asked bidders to apply by May 22, according to a notice published by the state-run agency. The country, Asia´s third largest user of sugar, requires a total of 1.2 million tons of sugar to bridge a gap in supplies that has pushed prices to near a record.
Raw sugar for May delivery fell 0.6 percent to 16.07 cents a pound on ICE Futures U.S. at 12:37 p.m. in New York. From May, Russian imports are expected to pick up, which may offer some support to raw sugar prices, Macquarie Group analyst Kona Haque wrote in a report e-mailed today.
`Constructive Fundamentals´
Russia may import raw sugar in exchange for grain shipments, Agriculture Minister Yelena Skrynnik said today in a statement.
Russian refining of raw sugar imports fell 22 percent from the start of the year through April 1, compared with the year- earlier period, the country´s Sugar Producers´ Union said in a statement on its Web site today.
“Sentiment towards sugar remains fragile but we believe the recent sell-off has been overdone in light of the market´s still constructive fundamentals over coming months,” London- based Barclays Capital analyst Sudakshina Unnikrishnan wrote in a report e-mailed today. The sweetener posted a seventh straight weekly decline last week. | 