By Julie Wernau
Sugar futures rose Wednesday with the market stuck trading in a sideways pattern at a time when one harvest is still underway and the next is still uncertain.
Raw sugar for March was up 1.5% to end at 14.25 cents a pound on the ICE Futures U.S. exchange, with futures stuck in the center of a range they've traded in for more than a month.
"Attention is also being focused already on Brazil's 2018/19 production in the case of sugar despite the fact that the 2017/18 processing period still has some time to run," Commerzbank noted. Sugar production in Brazil for 2017/2018 is expected to be higher than last year. According to the Brazilian Sugarcane Industry Association Unica, 26.4 million tons of sugar have been produced in the center-south region by mid-September, about 6% more than the same period last year.
The International Sugar Organization expects production to outstrip demand for sugar this year by 4.6 million tons, an increase to its estimate of 3 million tons in June, with sugar supplies expected to reach a record 179.3 million tons.
Analysts are still unclear about the direction of 2018/2019 production, with estimates of Brazilian production ranging from a decline of 1.3 million ton to an increase of 1 million tons next year. Archer Consulting released a preliminary estimate for the 2018/2019 crop Tuesday, saying that it sees a small expansion of cane fields in Brazil but a greater emphasis on ethanol production, which would leave sugar production stagnant next year at 35.5 million tons.
In other markets, cocoa for December was down 0.2% to settle at $2,078 a ton, arabica coffee for December lost 0.2% to end at $1.2515 a pound, frozen concentrated orange juice for November rose 1.9% to close at $1.582 a pound and December cotton was up 1.9% to end at 68.80 cents a pound.
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