ABN Amro sees raw sugar prices up 9.5%
Published: 07/27/2012, 4:50:25 PM
ABN Amro Bank says raw sugar's average price this year will be 9.5% higher than previously forecast because of adverse weather in producing nations, NV according to Bloomberg.
The sweetener will average 23 cents a pound, against its prior forecast of 21 cents, the bank said today in a report. In May it had predicted pressure on prices because of expected production surpluses, particularly in India.
Sugar output in Brazil's main producing area slid 31% in June's second half as wet weather delayed harvesting, industry group UNICA said this month. The South American country is the world's largest producer and India ranks second.
"Prices could remain elevated, because the unseasonable rains in Brazil, heavy rains in Australia and a delayed start of the Indian monsoon all affect the 2012/13 harvest," Hans van Cleef, an analyst at ABN Amro in Amsterdam, wrote in the report. Australia is the third-biggest global sugar exporter.
Higher production in Russia, Europe, Thailand and China and elevated existing supplies helped to compensate for lower output elsewhere, the bank said.