Raw Sugar Prices Hit Two-Week High on ICE Futures

Raw sugar futures traded on the Intercontinental Exchange (ICE) saw an increase on Tuesday, reaching a two-week high. The sweetener's price was buoyed by rising crude oil prices. The May raw sugar contract closed up 0.28 cents, or 2%, settling at 14.11 cents per pound. During the session, it touched 14.16 cents per pound, marking its highest value since April 9th. This comes after the contract had fallen to a five-year low in mid-April. Brokerage firm ADMIS noted that the lack of a breakthrough in peace talks between the United States and Iran is providing support to oil prices. This, in turn, supports sugar prices with the expectation that higher oil prices will encourage increased sugarcane milling for ethanol production over sugar, thus tightening sugar supply. ADMIS also highlighted that Brazil is considering raising its mandatory ethanol blending requirement in gasoline from 30% to 32%. Furthermore, the anticipated arrival of El Niño in June could reduce Asian sugarcane harvests this year. "The Indian Meteorological Department is already expecting a below-normal monsoon," ADMIS stated. Domestically in Brazil, the National Supply Company (Conab) projected a near-record sugarcane harvest on Tuesday but indicated that sugar production would likely fall by 0.5%. Against this backdrop, the most active white sugar contract rose 1.4% to $432.90 per ton.