NEW YORK, Feb 08, 2006 (Dow Jones Commodities News via Comtex) --The March world raw sugar contract was up 11 points at 18.28 cents a pound on the New York Board of Trade midway through Wednesday's session, erasing a 27-point drop to Tuesday's low.
Thai sugar premiums rose in the week ended Tuesday as sellers anticipated buying from Indonesia, Philippines and Taiwan. "Fresh demand is brewing and we are in a position to export," a Bangkok-based trader said. Buyers in Asia are returning to the market after the Lunar New Year holidays. On Tuesday, Thai raws for March-May shipment were offered at 0.80 cent/lb., free-on-board Bangkok, over the Nybot March contract, versus 0.75 cent a week ago.
Indonesian's Bulog is shopping for white sugar this week, traders said. Trading Corp. of Pakistan is looking for 50,000 tons of refined sugar on Feb. 16 for mid-March shipment. The Philippines needs to buy.
Funds exited March longs in the early slide but trade houses bought the March/May spread, providing support. March has stayed in Tuesday's range so far.
"We're occupied with the March roll and there's some positioning ahead of Friday's March options expiration," a desk trader here said. Funds are selling the March/May spread while trade houses buy the switch in their rollovers, he observed.
March is trading at a premium to May after the Mar/May spread settled at "even" on Tuesday. March has retreated from Friday's 24-year high of 19.73c.
Nybot March world sugar options expire Friday, and the March futures exit the board on Feb. 28.
Nybot March finds support at 17.90, 17.88, 17.85, 17.82 and 17.80 cents and faces resistance at 18.35-18.36, 18.38, 18.40, 18.42 and 18.45 cents. The March domestic (No. 14) contract expires Friday.
Dow Jones Newswires