Sugar Rises as Pakistan Forms Import Panel; Coffee Gains to One-Week High
Raw sugar rose in New York, erasing a decline, after Pakistan formed a panel to report on imports of the sweetener to alleviate a shortage estimated at 1.2 million metric tons next year. Coffee also climbed.
The panel will make its assessment on overseas purchases within a week, the Industries Ministry in Islamabad said in a statement. Floods destroyed 200,000 acres of sugar cane, a farm group in the South Asian nation said last month.
Pakistan, which consumes about 4 million tons of sugar a year, has “a natural deficit as it is,” said James Kirkup, the head of sugar broking at ABN Amro Markets (U.K.) Ltd. in London. “There’s losses due to the floods.”
Raw sugar futures for March delivery climbed 0.41 cent, or 1.8 percent, to 23.14 cents a pound at 10:03 a.m. on ICE Futures U.S. in New York. The contract earlier slid as much as 1.8 percent. In London, refined sugar for December delivery added $11, or 1.9 percent, to $604.20 a ton on NYSE Liffe.
Arabica coffee for December delivery added 1.7 cents, or 0.9 percent, to $1.9585 a pound on ICE. The contract reached $1.976, the highest level since Sept. 8.
Robusta coffee for November delivery climbed $28, or 1.7 percent, to $1,657 a ton on NYSE Liffe, after touching $1,671, also the highest price since Sept. 8.
Coffee rose because of a supply shortage ahead of the harvest in Vietnam, which usually starts in November. The country, the largest grower of robusta beans, will produce about 20 million bags, the same as in the previous year according to Andrea Thompson, an analyst at CoffeeNetwork in Belfast, Northern Ireland.
“There is a window of six weeks” before the harvest, Thompson said. “People are waiting for new estimates of the 2010-11 season.”
In addition, Indonesia’s harvest has been delayed by rains, Thompson said.
For the 2010-11 season starting Oct. 1, robusta and arabica production will top demand, CoffeeNetwork estimates. In the current season, arabica was in shortage and robusta had a surplus, Thompson said. Indonesia’s harvest will rise to 9.4 million bags from 9 million bags in 2009-10 and India’s crop will swell to 5.1 million bags from 4.9 million bags, she said.
A bag of coffee weights 60 kilograms (132 pounds).