by CommodityOnline
positive trends continue in ICE Raw Sugar futures for May delivery which is up 1.18% at US$ 0.171 a pound on possible El Nino impacting sugar production in Brazil later this year.But markets have calmed down after ral..
NEW YORK (Commodity Online): The world is awash with sugar as Brazil sugar is being offered at deep discounts for export and new harvest a few weeks away.
However, positive trends continue in ICE Raw Sugar futures for May delivery which is up 1.18% at US$ 0.171 a pound on possible El Nino impacting sugar production in Brazil later this year.But markets have calmed down after rallying to a four-month high of $0.1846 a pound.
In the short run, however, raw sugar is being offered at 10 points below ICE futures which suggests abundant stocks worldwide, a Reuters report quoting trade sources said.
Cane crush in Thailand, the world's second largest exporter,is also expeced to reach an all time high in 2013-14 season. Meanwhile, markets concerned over El Nino phenomenon appearing this year have pushed up prices of raw sugar at ICE. in the past month.
Climate models show Pacific Ocean surface temperatures are rising with an increasing probability of turning into El Nino for the first time since 2009.
Meanwhile, U.S. sugar futures for May delivery declined 0.36% to trade at $0.1678 a pound. The May sugar contract eased up 0.06% to settle at $0.1684 a pound on Monday.
Standarad Chartered Plc is bullish on March 2015 ICE futures as global supplies may fall on El Nino phenomenon. Dry weather in Brazil's Center south threatens to reduce this year's crop that begins harvest next month. Temperatures in Sao Paulo state reached the highest in 10 years in January and February, Stan Chart said.
According to UNICA, Brazilian mills have produced 34.27 mn tn of sugar from the start of the cane season on April 1, higher by 0.58% last year. Sugar output in Brazil's main cane region in December stood at 1.13 mn tn. The ISO has estimated sugar surplus to fall to 4.5 mn tn in 2013/14 as against 10.3 mn tn last year.
On daily charts, US sugar futures is indicating strong buy as RSI of 64.73 is bullish while StochRSI at 88 indicates overbought positions.
India Sugar
Meanwhile, Sugar futures for April delivery at India's National Commodity and Derivatives Exchange (NCDEX) rose 1.32% to Rs 3074 per 100 kg.According to the latest estimates by ISMA, production is estimated 23.8 mn tn for 2013-14 season A good monsoon last season led to higher output for fourth consecutive year in row in 2013-14.
ISMA has estimated that the opening balance as on October 1, 2013 (for the new season 2013-14), at around 88 lakh tonne, which is about 20 lakh tonne more than the normal opening balance.
In 2012/13, mills could export only a small amount of sugar due to lower global prices. It could export as much as 3-3.5 million tons of sugar in the season beginning October to get rid of excess supply.
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