April 29 (Bloomberg) -- Sugar prices rose for the sixth time in seven sessions on forecasts that consumption will exceed output and as a crude-oil rally increases the appeal of ethanol made from cane in Brazil. Cocoa declined.Global demand may exceed production by 2 million metric tons in the year through September 2010, after a deficit of 9 million tons in the current year, Sucres et Denrées SA said today. Crude oil rose as much as 3 percent. Brazil’s largest sugar-producing area, the Center South, will turn 42 percent of its cane into sweetener this year, up from 39.5 percent in the past season, an industry group said. The rest will be turned into ethanol.
“The fact that crude oil has held is very supportive,” said Charles Nedoss, a senior account manager at Peak Trading in Chicago, division of Rosenthal Collins. “I am very bullish sugar.”
Raw-sugar futures for July delivery rose 0.04 cent, or 0.3 percent, to 14.08 cents a pound on ICE Futures U.S. in New York. The price has gained 19 percent this year on forecasts that a decline in output by India will lead to a global production deficit.
“All the fundamental news continues to be constructive,” said Nick Hungate, a senior trader at Rabobank International in London. “Demand has been fairly well maintained. India will have to come into the market fairly soon.”
On ICE, cocoa futures for July delivery fell $1 to $2,403 a metric ton. The price has dropped 9.8 percent this year amid concerns that the recession will reduce demand.
To contact the reporter on this story: Shruti Date Singh in Chicago at ssingh28@bloomberg.net.
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