Pakistani white sugar seen traded at $530 per tonne
SINGAPORE: White sugar from Pakistan attracted buying interest from the Middle East while Thai raw sugar premiums were little changed this week as physical trading began to slow down ahead of the year-end, dealers said on Tuesday.
Pakistan has allowed the export of an extra 200,000 tonnes of sugar, on top of the 300,000 tonnes already allowed, as the government aims to trim surplus stocks and boost local prices.
“Pakistan is still offering white sugar and the price is about $530 for 100 ICUMSA. The suppliers have told me that they are doing trades at this level,” a dealer in Singapore said.
“The buyers are from the Middle East. I haven’t heard anything from India. They are still quoting white sugar at $35 to $55 premiums.”
The lower the ICUMSA level, the higher the degree of whiteness. Pakistani white sugar, which competes with Indian sweetener, was traded at $520 a tonne last week and dealers expected more offers in coming weeks.
“Estimates for 2012/13 production mostly lie between 4.9 and 5.5 million tonnes, white value, up from 4.7 million tonnes last year. Industry sources suggest the higher estimates are exaggerated, and are an attempt to convince authorities to allow more exports,” said Green Pool Commodity Specialists.
“The Pakistan Sugar Mills Association (PSMA) has asked the government to allow the export of at least 1.2 million tonnes of white refined sugar instead of the existing limit of 400,000 tonnes.”
March white sugar on Liffe fell $9.50, or 1.8 per cent, to close at $506.00 per tonne on Monday, tracking declines in New York raws.
Thai high polarisation, or hipol, raw sugar was quoted at premiums of 65 points to New York’s March contract, unchanged from last week, because of a lack of activity in the physical market.
Brazilian raws, which have attracted buying interest from Indonesia, were quoted at a small premium to New York futures.
“We heard that Brazilian raws have been traded at 10 points premiums for March delivery. It’s been sold to a major trading house, but I am not sure if it’s destined for Indonesia,” said a dealer in Jakarta, referring to Southeast Asia’s largest buyer.
March raw sugar on ICE settled down 0.45 cent, or 2.3 per cent, at 18.76 cents a lb on Monday, the spot contract’s weakest finish since August 2010, after reports from top producer Brazil emphasized plentiful supplies.
Thailand, the world’s second-largest exporter after Brazil, has lowered its forecast for sugar output in the year to October 2013, to 9.4 million tonnes from 10 million on poor rain, but the figure is in line with traders’ estimates of 9.3 million to 9.5 million tonnes. “Nothing has really moved. Brazilian crushing season is going to come to an end soon, and the season in Thailand is progressing well. Activity is pretty slow at this time of the year,” said another dealer in Singapore.
“The Japanese are not really looking for sugar. I think Indonesia has bought most of the sugar it needs for next year.”
The premiums for the J-spec variety, or low-quality Thai sugar favoured by Japanese, were unchanged at 70 points to New York futures.