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Raw sugar soars 6 pct to 2012 peak

Raw sugar futures rallied more than 6 percent to the highest in more than 3-1/2
years on Wednesday, on heavy fund and chart-based buying as the end of the second quarter neared and the currency in top grower
Brazil rallied to an 11-month peak.
    Arabica coffee futures also extended gains to reach a three-week high, joining the bullish fervor in larger commodity
markets as the U.S. dollar fell for the second straight day and risk appetite returned to markets on reduced concerns
surrounding Britain's vote to leave the European Union. 
    New York cocoa prices rose along with the firm British pound , which extended its rebound above Monday's 31-year low,
while the currency pressured the London market. 
    October raw sugar settled up 1.07 cent, or 5.4 percent, at 21.01 cents per lb, its biggest one-day jump since
mid-April. It soared to as high as 21.2 cents, up 6.3 percent, to the highest since October 2012 for the second month contract.
    "We expected it would go up but it's a lot. There's a lot of buying by the funds," one U.S. trader said.
    It was on track to close the second quarter up 36 percent, by far its strongest since the end of 2010.
    "Tomorrow is month and quarter end, with the likelihood that fund managers will want a buoyant close, not only in sugar, but
across the commodity spectrum," a senior broker said.
    Also bullish for sugar futures was the expectation for data to show reduced crushing in Brazil's main region, traders said.
    Despite the price surge, the July/October spread SBN6-V6 widened only slightly ahead of the July contract's expiry
on Thursday, to a discount of around 0.19 cent.
    Still, dealers spoke of expectations of a large delivery, possibly over 1 million tonnes, of mainly Brazilian sugar. 
    August white sugar settled up $20.10, or 3.7 percent, at $568.20 per tonne, after surging to a contract high
at $572.70.
    Arabica futures joined in on the commodity-wide rally with added concerns over the quality coming out of Brazil. 
    September arabica settled up 3.85 cent, or 2.7
percent, at $1.4445 per lb, reaching the highest since June 9.
    September robusta settled up $21, or 1.23 percent, at $1,722 per tonne, underpinned by expectations that Vietnamese
robusta exports could slow down. Exchange-for-physical volume surged to a two-month high. 
    London September cocoa settled down 9 pounds, or 0.4 percent, at 2,355 pounds per tonne, while New York September
cocoa settled up $28, or 0.9 percent, at $3,034 per tonne.
(Reuters)

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