ICE futures surge on Brazilian woes
Published: 07/09/2012, 7:50:37 AM
Futures of raw sugar rallied to their highest settlement since April on Friday as rains in top grower Brazil continued to prop up prices of the sweetener, according to Dow Jones.
Sugar for October delivery on ICE Futures U.S. rose 1.5% to settle at 22.25 cents a pound on Friday, the highest settlement since April 18.
Prices moved higher despite headwinds from disappointing jobs data from the U.S., which pushed down other commodities like crude, cocoa and corn.
"The fact that we closed up and the commodities complex is down is certainly a positive sign," said Michael McDougall, a senior vice president at brokerage Newedge.
Unseasonable rain in Brazil has caused delays in cane-harvesting as well as shipments at the ports. Brazil is the source of around one-fifth of the world's sugar.
Last week, Brazil's main sugar and ethanol association, UNICA, said the wet weather has "severely hampered" the country's sugarcane harvest this season. The heavy rain also has diminished the sugar content in the cane.
Since the 2012/13 harvest began in April, sugarcane processing is down 28.7% at 96.6 million metric tonnes.
"The market is sensitive to any weather issue in Brazil," McDougall said.
Raw-sugar futures have gained 4% since last Monday's close, when the October contract became the front month.