Sugar prices surged, extending a rally to a 28-year high, on mounting concern that a global production deficit will widen as the outlook worsened for crops in India, the world’s second-largest producer.
Monsoons this year will be 87 per cent of the long-term average, down from 93 per cent forecast in June, said Ajit Tyagi, the India Meteorological Department’s director general.
Sugar has surged 86 per cent this year after India boosted imports and rains delayed harvesting in Brazil, the biggest grower.
“Sugar is extending the rally on continued weather problems: Brazil is getting too much rain and India is not getting enough,” said Phil Streible, a Chicago-based broker at Lind-Waldock, a unit of MF Global.
In other markets, soybean prices tumbled the most in a month on speculation that wet, warm weather in the US Midwest will boost crop prospects.
Gold also declined. The UBS Bloomberg Constant Maturity Commodity Index was little changed at 1,163.13.
Sugar futures for October delivery jumped 1.19 cents, or 5.7 per cent, to 22 cents a pound on ICE Futures US in New York. Earlier, the price touched 22.44 cents, the highest for a most-active contract since March 27th, 1981.
Bloomberg