Raw Sugar Rises on Concern for Harvest in Brazil

Raw-sugar futures advanced to a five-month high in New York as dry weather threatened to damage the crop in Brazil, the world’s biggest producer. Cocoa and coffee also rose.

The sugar-cane harvest in Brazil’s Center South, the world’s largest producing region, may be less than the 570 million metric tons forecast last week if dry weather persists, Marcos Jank, the president of industry group Unica, said yesterday. China, the third-largest producer, may become one of the top 10 importers next year, according to Cargill Inc., the world’s biggest trader of agricultural commodities.

“The market is rising on renewed fears about Brazil,” said Marius Sonnen, the president of Sonnen & Co., a New York- based sugar trader. “Also, there is speculation that China will be a big importer next year.”

Raw sugar for October delivery gained 0.74 cent, or 3.7 percent, to settle at 20.49 cents a pound at 2 p.m. on ICE Futures U.S. in New York. Earlier, the most-active contract jumped 4 percent to 20.54 cents, the highest level since March 9.

Raw sugar has surged 58 percent from a 13-month low on May 7, boosted by concern that adverse weather will lower output in Brazil, Russia and China.

The price may advance to as high as 23.7 cents, according to Michael McDougall, a senior vice president at Newedge USA, a broker in New York.

On NYSE Liffe in London, white sugar for October delivery gained $2.20, or 0.4 percent, to $580.90 a metric ton.

Cocoa, Coffee

Cocoa for December delivery rose $16, or 0.6 percent, to settle at $2,752 a metric ton at 11:59 a.m. on ICE. The commodity has declined 16 percent this year.

In London, cocoa for September delivery dropped 25 pounds, or 1.3 percent, to 1,926 pounds ($2,976) a ton on NYSE Liffe, after slipping to 1,901 pounds, the lowest level since Sept. 16. The September contract closed at a lower price than December futures for the second straight session, indicating growing supplies.

Arabica coffee for December delivery gained 3.9 cents, or 2.2 percent, to $1.8235 a pound in New York, rising for the fourth time in five sessions. Robusta coffee for November delivery advanced $6, or 0.4 percent, to $1,647 a ton in London.

source: bloomberg