Raw Sugar Makes Biggest Gain in 2 Months; Cotton Hits 4-Week High

Leslie Josephs

  NEW YORK--Raw-sugar prices registered their biggest daily gain in two months on Thursday, as

investors anticipated an early end to Brazil's harvest.

  Raw sugar for delivery in October rose 1.9%, the biggest percentage gain since June 20, to 15.99

cents a pound on the ICE Futures U.S. exchange. It was the highest settlement for the most actively

traded sugar contract since Aug. 13.

  Since the season began in April, sugar output from Brazil, the world's largest sugar producer and

exporter, have increased from a year ago, but sugarcane processing and production of the sweetener

slumped last month, prompting worries that the harvest will end earlier than usual. Brazilian mills

had been racing to process as much cane as possible during dry weather earlier this year.

  Mills in the center-south region, where 90% of Brazil's crop is grown, crushed nearly 36 million

metric tons of cane in the second half of July, down 19% from a year earlier, Brazilian sugarcane

industry group Unica said last week. Sugar output dropped 12% to 2.2 million tons in the period,

partly because rains impeded the harvest of cane.

The group's next report, on the first two weeks of August, is due next week.

  The rally was mainly from short-covering, when traders close out bets that prices would fall, said

Agrilion Commodity Advisers LLC, a consulting firm in New York.

  If Brazil's harvest ends early, it could mean less sugar added to the expected global glut this

year, analysts have said.

  Cotton futures ended a choppy session at a four-week high. The December contract rose 0.2% to end

at 65.92 cents a pound, despite a drop in U.S. export sales.

  Export sales of upland cotton fell 12% in the week ended Aug. 14 to 155,600 bales, the U.S.

Department of Agriculture said in a weekly report released Thursday. Upland cotton is the variety

most commonly grown in the U.S. Still, total export sales as of Thursday are almost double what they

were at the same time a year ago, at 4.5 million bales.

  Arabica coffee for December ended 0.3% higher at $1.8960 a pound, while orange-juice concentrate

for November fell 0.1% to end at $1.4810 a pound.

Cocoa for December fell 0.8% to settle at $3,200 a ton, the lowest since Aug. 5.