Rising demand for white, or refined, sugar in Muslim countries is helping lift prices for the raw variety due to refiners’ demand, according to Castlestone Management Ltd.
Muslim nations usually stock up on sugar ahead of Ramadan, the Islamic month of fasting that starts around the beginning of August. Brazil is scheduled to ship as much as 735,570 metric tons of the raw sweetener between June 1 and July 15 to various Muslim countries, data from shipping agency Williams Servicos Maritimos Ltda showed.
“There is a large need for physical sugar to get to the refineries,” Connor Noonan, an analyst with Castlestone Management said in an e-mail today. “With more and more demand for whites from Muslim countries we are seeing a spillover into the raws.” Al Khaleej, the world’s largest sugar refinery is located in Dubai, UAE.
Raw sugar for July delivery rose 3.9 percent to 23.35 cents a pound on ICE Futures U.S. in New York by 10:19 a.m. White, or refined, sugar for August delivery climbed $22.50, or 3.4 percent, to $687.10 a metric ton on NYSE Liffe in London.
The white sugar premium over the raw variety climbed to $173 a ton, the highest since June 17, according to data on Bloomberg.
Brazil is scheduled to send about 239,830 tons of raw sugar to Iran and 137,250 tons to Algeria, data from Williams Brasil showed. Egypt, Syria, Morocco, Bangladesh, Indonesia, Malaysia and the United Arab Emirates are also expected to receive raw sweetener from the South American country.
To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.