March raw sugar settled up 0.55 cent, or 2.4 percent, at 23.81 cents per lb after rising to 23.86 cents, the highest since July 2012 on the spot continuation chart.
The March contract failed to climb to last week’s high and technical resistance level of 24.1 cents, reached prior to the expiry of October, which was the spot contract at the time.
“News from India that sugar production will be lower than anticipated, with some surveys showing that production might decrease by 10 percent … together with reports that the tail end of the crushing season in Brazil is disappointing are driving sugar prices,” said Commerzbank analyst Michaela Kuhl.
In Brazil, recent forecasts for sugar cane processing have been at the lower end of prior expectations.
“Mills are expected to finish harvest earlier due to dryness,” said Michael McDougall, director of commodities for Societe Generale in New York, adding that more than 1,000 towns primarily in Brazil’s north-east region have declared a state of emergency due to drought.
Talk of a global sugar deficit in both the 2015/16 and 2016/17 seasons lifted the mood at a series of meetings in London ahead of a biennial trade dinner on Thursday.
December whites settled up $9, or 1.5 percent, at $604.50 per tonne.
Cocoa prices rose for the fourth straight session as exporters in top grower Ivory Coast said port arrivals had been halted for several days because many buyers have been temporarily blocked out of the booking system.
“I am also hearing the weather outlook and recent heavy rainfall in Ivory Coast and Ghana could cause flooding problems and have some traders anticipating disease issues in the coming months,” said Peter Mooses, senior market strategist for RJO Futures in Chicago.
March London cocoa settled up 15 pounds, or 0.7 percent, at 2,226 pounds per tonne, while New York December cocoa settled up $21, or 0.8 percent, at $2,836 per tonne.
In coffee, November robusta settled up $36, or 1.8 percent, at $1,994 per tonne, while December arabica settled up 0.75 cent, or 0.5 percent, at $1.482 per lb.