Raw Sugar Futures Set for Biggest Yearly Advance Since 2016
Sugar headed for the highest annual gain in four years as demand improves and global supply tightens.
Key buyers Indonesia and China are ramping up imports of sugar at a time when the market also is contending with a lower crop outlook in Thailand and dry weather concerns in top shipper Brazil. Markets also will keep an eye on domestic ethanol demand in Brazil, a key factor in determining the nation’s sugar production next year.
“With demand remaining strong through the Covid shutdowns, sugar prices should remain fairly well supported on near-term pullbacks,” the Chicago-based Hightower Report said. “Drier than normal conditions over Center-South cane-growing areas are expected to result in a decline in Brazil’s 2021/22 sugar production, and that decline would rise if Center-South mills have a large shift to ethanol production.”
Raw sugar futures for March delivery rose as much as 1.3% to 15.48 cents a pound, the highest in more than a month, before paring gains in New York. Prices advanced for an eighth straight month in December, the longest run of monthly gains since 2006. White-sugar futures were steady in London.
In other soft commodities, cocoa was little changed in New York and London, while arabica coffee rose in New York.
— With assistance by Marvin G Perez
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