Raw sugar hits 30-year peak, cocoa falls
London, December 29, 2010
ICE raw sugar futures edged up to a fresh 30-year peak on Wednesday due to tight supplies, while cocoa fell after bean arrivals data showed ample supplies were getting through despite a fierce power struggle in Ivory Coast.
ICE arabica coffee futures declined, though remaining close to last week's 13-1/2-year high, supported by limited availability of high-quality beans from Colombia.
In the sugar market, dealers said investment funds were pushing futures up in a bid to square books in 2010 with high valuations. They noted cash demand was scarce at high prices.
Adverse weather in key producers such as Brazil and Australia has contributed to a tight global supply outlook.
"Fund managers want sugar steady for the end of the year. They've had a pretty torrid time after the sell-off earlier in the year," a senior sugar futures broker said.
Nick Penney, a broker with Sucden Financial, said: "The sugar markets continue to be firm despite the odd setback. He added: "It is still possible that there may be liquidation and book-squaring toward the end of the week, but we believe the early part of 2011 will see new highs in (whites and raws) markets."
ICE March raw sugar was up 0.25 cent or 0.7 percent at 34.64 cents a lb in a modest volume of 3,459 lots at 1245 GMT, having earlier touched a fresh 30-year peak of 34.71 cents a lb.
London March white sugar was up $13.40 or 1.6 percent at $833.80 per tonne at 1246 GMT, having earlier touched a contract high of $835.70 per tonne.
Cocoa futures fell after the latest bean arrivals figures from Ivory Coast showed that steady supplies were reaching the international market. - Reuters