Investors Boost Bearish Refined-Sugar Bets to Highest Since June

Money managers raised bearish bets on white, or refined, sugar traded in London to the highest level since June amid prospects for excess supplies, according to NYSE Liffe, the derivatives arm of NYSE Euronext.

Investors were net-short, or betting on lower prices, by 2,295 futures and options in the week through Jan. 7, the Commitments of Traders report on the exchange’s website showed today. That was the biggest bearish bet since June 18 and compares with 791 lots in the week through Dec. 30, exchange data compiled by Bloomberg showed. The sweetener fell 1.5 percent in the latest period.

Global sugar supplies will exceed demand by 4.73 million metric tons in the 2013-14 season started Oct. 1, a fourth straight surplus, estimates the International Sugar Organization in London. The premium refined sugar commands over the raw variety slid 5.5 percent to about $82.40 a ton this year on signs of rising supplies. Raw sugar fell 5.6 percent this year and the white variety declined 5.4 percent.

“The situation is not much better in the whites market,” Nick Penney, a senior trader at brokerage Sucden Financial Ltd. in London, said in a report e-mailed today. “Refineries are competing in an oversupplied market and facing competition from producers in Central America and also Mexico, where pressure to export whites is gathering once again despite a slightly lower production expected this year.”

Ivory Coast

In cocoa, money managers cut bets on higher prices for a fifth week as bean deliveries to ports in top producer Ivory Coast surged, narrowing shortage forecasts. Investors were net-long by 64,307 futures and options as of Jan. 7, compared with 65,414 contracts on Dec. 30, NYSE Liffe data showed. The beans used to make chocolate fell 0.2 percent in the latest period.

Cocoa deliveries to ports in Ivory Coast were estimated to have risen 36 percent to 970,000 tons from the start of the season on Oct. 1 through to Jan. 5, according to data on website of KnowledgeCharts, a unit of Commodities Risk Analysis in Bethlehem, Pennsylvania. Bean supplies will fall short of demand by 75,000 tons, estimates Jeff Adler, a managing director at M.J. Nugent & Co. in New York. That’s down from a September forecast for a shortage of 180,000 tons.

Investors trimmed bets on higher robusta coffee prices to 7,669 futures and options, the data showed. That compares with 8,894 contracts as of Dec. 30. The beans used to make instant coffee and espresso rose 1.2 percent in the period.

In feed wheat, money managers were net-short by 159 contracts, unchanged from Dec. 30. The grain fell 1.7 percent in the period.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE