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CSCE sugar creeps to higher close on spread trade

NEW YORK: CSCE raw sugar futures crawled to another marginally higher finish on Wednesday, boosted mainly by spread activity in another sleepy session.

"It's boring, boring, boring. You got a small pop on the spreads and probably some trade sales uptop, but that's it," a veteran floor broker said.

May sugar inched up 0.05 to settle at 5.25 cents a lb, trading 5.26-5.16 cents.

July gained 0.03 to 5.31 cents. The rest were 0.02 to 0.03 cent higher at the end.

Sugar retreated at the start but trade buying of spreads gave the market a positive sheen and allowed it to work its way north, floor sources and physical brokers said.

ED & F Man was said to be a noted buyer. Capstone was said to have done some buying of May/Julys while Cargill did some Oct/March business, they said.

"There was some scale trade selling when we got over the 5.20 mark, but the whole thing was again very light," a dealer said, adding the resistance was likely tied to very modest producer pricing.

Physical business remained decidedly routine.

In industry news, traders in Hong Kong said Wednesday China may import sugar for the first time in years but such imports may not occur until March or April 2001.

Reflecting the uncertainty surrounding Chinese intentions, Patrick Funaro, vice-president of the Latin American desk in FIMAT Futures, told Reuters the trade expects imports by China this year of 500,000 tonnes of sugar.

"(But) I don't know if that's going to happen," he said.

"If they do any sugar importing this year, it would likely be small," added Arthur Stevenson, softs analyst for Prudential Securities here.

Technically, dealers feel resistance in the May raw sugar contract was still intact at the 40-day moving average at 5.33, the recent high of 5.35, the 50-day moving average of 5.39, 5.43 and then 5.50 cents.

Support would be at the double bottom of 5.03, 5.00 cents, 4.90, the contract low of 4.84 cents and then 4.50 cents.

Estimated final volume reached 15,218 lots, against the previous estimated volume of 19,310 lots. Call volume stood at an estimated 2,061 lots while puts reached around 2,416 lots.

The CSCE is a subsidiary of the New York Board of Trade.-Reuters