ICE October raw sugar futures slipped 0.1 cent to 17.75
cents per lb at 1512 GMT, below Tuesday's three-year peak of
18.09 cents.
London August white sugar was down $2.2 to $456.50 per
tonne, having earlier touched a contract high of $465.20.
"Sentiment is still bullish, but in any bullish market there
are periods when price runs ahead of physical demand," said
Jonathan Kingsman, managing director of Lausanne-based
consultancy Kingsman SA. "And so you may get a correction."
Rabobank soft commodity trader Nick Hungate said the
delivery echoed Cargill's emergence as the main receiver of the
May contract which expired on April 30.
"There was a subsequent strong rally in the market, so that
is in the back of people's minds," Hungate said.
"Every time we think the market has done enough we get some
more bullish fundamental news," Hungate said.
"It's a classic sign of a very robust, bull market. It's a
market that doesn't let you in cheaply and a market in which
flames keep on being fanned with bullish fundamental
information.
"So, can it go higher? I think it can. Will it go higher?
Who knows? There's no doubt we'll get a lot of volatility
because trading conditions are still pretty thin," he said.
Kingsman said expectations of a global sugar deficit were
driving up sugar futures prices sharply this year.
He said Brazilian mills were making as much sugar as they
could, but their capacity was limited relative to demand.
Brazil's 2009/10 centre-south cane crush reached 142.1
million tonnes by June 15, nearly one third more than the 107.7
million tonnes crushed by this time last year, the Sugar Cane
Industry Association (Unica) said Wednesday.
Dealers noted the delayed monsoon in India was buoying sugar
prices, and referred to concern over the impact of the El Nino
weather pattern on the global sugar output outlook.
Raw sugar futures have surged by over 50 percent so far this
year, making sugar one of the star performers of the commodities
complex, spurred by a strong appetite from South Asia.
Most of the sugar received by Cargill is believed to be
destined for India, the world's top consumer which has swung to
a net importer from exporter after a dismal domestic harvest.
ARABICAS LITTLE CHANGED
Arabica futures were flat in thin volumes, aided by the weak
dollar and strong oil prices, while robustas edged lower weighed
by light origin selling, a coffee trader said.
London's September robusta contract was down $11 at $1,324
per tonne, above last Thursday's $1,250 contract low.
September arabica futures on ICE fell 0.3 cents to $1.1960
per lb.
Rains have come to a halt in the coffee producing areas of
Brazil, the world's top grower, private weather forecaster Somar
said, after showers last week prevented farmers from harvesting
and drying their beans.
In London cocoa, dealers said a weak pound gave support, but
worries over demand prospects dragged on the market.
"Q2 grindings are not going to be good," one London trader
said.
Sucden Financial said in a daily market report that cocoa
values seem unable to free themselves from recent ranges.
London September cocoa was down 5 pounds to 1,600 pounds per
tonne in modest volume of 2,827 lots.
ICE September cocoa was up $2 to $2,512 per tonne.
(Editing by James Jukwey)
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