Raw sugar fell to the lowest level since 2010 in New York, as the harvest in Brazil, the world’s largest producer, added to speculation of another surplus next season. Coffee and cocoa retreated.
Brazil’s centre-south, which accounts for 90 per cent of the country’s sugar production, is harvesting the crop that will be part of the 2012-13 season. Global sugar production will exceed demand by 4.6 million tonne in that period, the third consecutive surplus, according to Rabobank International. “The lack of significant demand means sugar is coming under harvest pressure from Brazil,” Keith Flury, a senior analyst at the bank in London, said by e-mail today.
Raw sugar for July delivery was 1.9 per cent down at 19.05 cents a pound by 8:33 am on ICE Futures US in New York. The price touched 19.03 cents a pound, the lowest since August 18, 2010. White, or refined, sugar for August delivery fell 1.3 per cent to $551.10 a tonne on NYSE Liffe in London.
Raw sugar has dropped 18 per cent this year. The sweetener slid 27 per cent last year, the most in a decade. Global production will exceed demand by 8.1 mt in the 2011-12 season ending in September after a surplus of 1.7 mt in the 2010-11 crop year, according to Rabobank.
“Asian and Chinese restocking of sugar spurred by lower prices had provided a temporary floor to the market, but the global surplus and large Brazilian harvest will continue to weigh,” Kate Tang, an analyst at Barclays Plc, said in a report e-mailed today.
Arabica coffee for July delivery was down 1.8 per cent to $1.577 a pound in New York. Robusta coffee for July delivery fell 2.9 per cent to $2,116 a tonee in London. Robusta coffee stockpiles with valid certificates in warehouses monitored by NYSE Liffe were 176,190 tonnes as of May 28, up 2.8 per cent from two weeks earlier, according to data from the exchange on its website yesterday. That was the first time inventories rose since July 11. Cocoa for July delivery was down 2.3 per cent to $2,035 a tonne in New York. Cocoa for July delivery retreated 1.4 per cent to £1,450 a tonne in London.