By Carolyn Cui

Sugar futures rose Friday, as an industry group said Brazilian sugar production fell in the first half of March from a year earlier.

Raw sugar for May delivery added 0.6% to settle at 17.71 cents a pound on the ICE Futures U.S. exchange.

According to Unica, center-south mills in Brazil crushed 3.3 million metric tons of cane during the first fortnight in March, a decrease of 38.4% from the same period a year earlier.

During the period, they produced 73,000 tons of sugar, down 48.3%, and made 161 million liters of ethanol, a decline of 28.3%.

Friday's Unica report lent some support to the sugar market which lately has been weighed down by a lack of fresh bullish news, triggering an exodus of speculators who were attracted early in the year by rising prices and a bullish outlook.

Brazil is the world's biggest sugar producer and exporter, and the center-south grows about 90% of the country's cane. The harvesting and crushing season is approaching its end, and the production figures are more volatile than during the height of the season because the quantities processed are much smaller.

Still, analysts are skeptical whether sugar prices have much room to go higher if India, one of the world's largest sugar consumers, keeps its tariffs high to prevent imports.

"The window for a rebound in sugar prices is narrowing," said Citigroup analysts in a research note published this week. "Once the Brazilian harvest kicks in to high gear in late summer, we see little room for renewed strength in sugar prices, absent any weather surprises," they said.

As a result, Citigroup lowered its price target for 2017 to 19.5 cents a pound, from 20.5 cents.

In other markets, cocoa for May fell 2.1% to close at $2,131 a ton, arabica coffee for May skidded 2.1% to end at $1.3760 a pound, frozen concentrated orange juice for May was down 2.6% to $1.8035 a pound, and May cotton rose 0.3% to end at 77.47 cents a pound.

Write to Carolyn Cui at carolyn.cui@wsj.com

(END) Dow Jones Newswires

March 24, 2017 16:27 ET (20:27 GMT)

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