Brazil’s Raw Sugar Discount Seen Widening on Bigger 2012-13 Crop
http://www.businessweek.com/news/2013-01-11/brazil-s-raw-sugar-discount-seen-widening-on-bigger-2012-13-cropJanuary 11, 2013 at 1:27 PM
Buyers of raw sugar from Brazil, the world’s top producer, are getting a larger discount for their sweetener as output in the country will be bigger than estimated, according to Swiss Sugar Brokers.
Raw sugar for loading this month at the port of Santos, the country’s biggest, traded at a discount of 0.5 cent a pound to the price of the March contract on the ICE Futures U.S. exchange in New York, data from the broker based in Rolle, Switzerland, showed. That compares with a discount of 0.4 cent on Dec. 19.
Sugar output in Brazil’s center south, the country’s main growing region, climbed to 34.1 million metric tons for the 2012-13 season after most harvesting ended, Unica said yesterday. The industry group last month raised its forecast for sugar production from 32.7 million tons. Output there “exceeded all expectations,” said Tom McNeill, a director at Brisbane, Australia-based researcher Green Pool Commodity Specialists Pty.
The discount for Brazilian raw sugar is widening even as sales increased after the end-of-year holidays, Naim Beydoun, a broker at Swiss Sugar Brokers, said in an e-mailed response to questions today. About 220,000 tons of the sweetener have traded for shipment in January and February, he said. Offers for sale have “dried up for the moment.”
“Whether sellers are backing off, finding home for their sugar or even carrying the sugar is to be seen,” he said. “However, if more sugar is to be carried, further weakening of cash values will be translated on the forward positions.”
Raw sugar from Brazil for loading in February was more expensive than this month, trading at 0.3 cent a pound under the exchange price, according to Swiss Sugar Brokers. That compares with a discount of 0.15 cent on Dec. 19.
Sign In © 2024 Green Pool Commodity Specialists All rights reserved.