Sugar Traders Bet Biggest Glut in Five Years Ending: Commodities
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Traders are betting that the biggest sugar glut since 2007 will shrink in the next harvest, reversing expectations from six months ago and ending the largest decline in prices in a decade.
Raw sugar for March 2013 is trading at a premium of 3.3 percent to the July 2012 contract on ICE Futures U.S. in New York, compared with a 6.6 percent discount six months ago. The switch is reflecting a change in outlook even before forecasts for the next season from the International Sugar Organization or U.S. Department of Agriculture. Prices may rise as much as 10 percent to 27 cents a pound by Dec. 31, according to the median of 21 analyst and trader estimates compiled by Bloomberg.