Improvement in global futures price of sugar due to strengthening of Real
21-Aug-2024 04:10 PM
New York. Global futures price of sugar improved somewhat due to strengthening of the currency of Brazil, the most prominent producer and exporting country, against the dollar.
For October contract, the futures price of raw sugar in New York Exchange increased by 0.15 cents per pound or 0.84 percent and the futures price of white sugar in London Exchange increased by 3.40 dollars per ton or 0.66 percent.
The exchange rate of Brazilian Real against the US dollar rose to a four-week high on the previous day.
After a considerable fall in the futures price of sugar, there were signs of improvement from last week and now it has strengthened to some extent.
The futures price of raw sugar in New York Exchange had fallen to the lowest level in the last two and a quarter years, while the futures price of white sugar in London Exchange also went to the lowest level in two and a quarter years.
There were signs of better production of sugar in Brazil and its global supply was also expected to increase. According to the latest report of Brazil's top industry body - UNICA,
during the four months of April to July in the current marketing season, sugar production in the central southern part of the country increased to 207.53 lakh tonnes, which was about 8 percent more than the production of the same period last year.
According to UNICA, during the entire marketing season (April-March) of 2023-24, compared to the 2022-23 season,
the total production of sugar in Brazil reached a top level of 424.25 lakh tonnes with a strong increase of 25.7 percent.
On the other hand, the central government subordinate body - CONAB has estimated the total production of sugar in Brazil to reach 462.92 lakh tonnes during the 2024-25 season with an increase of 1.3 percent compared to the 2023-24 season,
which includes the potential production of the central southern part as well as the northern and northeastern region.
The weather has started deteriorating in Brazil now. The weather is dry and hot in some parts while some areas have been hit by severe floods.
Sugar production is also likely to be weaker in July as compared to June while the signs for August do not look good.