Sugar futures climb as Australian shipments rise
Sugar shipments from Australia - the third-largest global exporter of the sweet commodity - may rise to their highest level in three years.
The ingredient's prosperity is due to better yields boosting production, leading to global supplies swelling, Bloomberg reports.
Exports may reach a total of 3.5 million metric tonnes in the year starting July 1st, which is 13 per cent more from the 2.9 million tonnes predicted in March, according to the Australian Bureau of Agricultural and Resource Economics and Sciences.
This is the highest figure reached since the year ending June 30th 2010, according to the Canberra-based department.
Raw sugar values have dropped by 15 per cent this year, extending last year's 27 per cent plunge as investors braced for a global glut.
The Australian Bureau expected raw sugar production to be 4.4 million tonnes for this period compared to the 4.2 million tonnes forecast in March.
Prices may fall to 17 cents per pound of the white stuff over the remainder of 2012, which is the lowest since 2010, as world supply is expected to exceed demand for a third consecutive season, according to some analysts.
In addition to production in Australia, sugar yields on a global scale may increase to an unprecedented level of 178 million tonnes in the year beginning October 1st, with output forecast to rise in Brazil, China, India and the US.
Brazil - the world's largest producer - saw its harvest fall by 19 per cent in the second half of last month to 1.9 million tonnes compared to the year before, as rain slowed harvesting.
Sustained monsoon conditions in the South American country may, according to Goldman Sachs, slash the country's crop and pare the three million tonnes in global surplus that has been forecast by the International Sugar Organisation.
Last night (June 19th), White Sugar Futures closed 2.7 per cent up to $611.5 per metric tonne.
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