Sugar Retraces as Producers Book Sales
September 01 2017 - 6:27PM
Dow Jones News
By Julie Wernau
Sugar futures fell back Friday as sweetener producers took
advantage of recent price spikes to book sales.
Raw sugar for October delivery dropped 4.5% to end at 13.75
cents a pound on the ICE Futures U.S. exchange, erasing a week of
gains. On Thursday, sugar prices reached their highest levels since
Aug. 3 on the back of energy-price spikes caused by the effects of
Hurricane Harvey in Texas.
Gasoline prices surged to a two-year high at the pump Thursday
after the owner of the largest pipeline in the U.S. reported
curtailed shipments as a result of the storm. Energy-price spikes
boosted sugar prices as sugarcane producers have a tendency to
convert more cane to ethanol when fuel prices are favorable,
tightening sugar production.
At the same time, the world's largest sugar producer, Brazil,
announced a 4.3% increase in the price of gasoline, which gives
ethanol an advantage over gasoline in the local Brazilian
market.
"Producers continue to sell to cover export requirements," Nick
Penney, senior trader at Sucden Financial, said in a note to
client.
"Some, we hear, are attempting to postpone shipments so they can
price against March."
In other markets, cocoa for December rose 1.1% to close at
$1,947 a ton, arabica coffee for December was off 0.2% to close at
$1.2905 a pound, frozen concentrated orange juice for November was
up 2% to end at $1.365 a pound, and December cotton edged up 1.3%
to end at 71.88 cents a pound.
Write to Julie Wernau at julie.wernau@wsj.com
(END) Dow Jones Newswires
September 01, 2017 18:12 ET (22:12 GMT)
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