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CSCE sugar closes flat in listless dealings

NEW YORK: CSCE sugar futures ended Wednesday barely changed as rollovers continued to dominate business, with more of the same expected ahead of expiration of front March next week.

"This is not the thing to watch right now. It's a boring market. I've never seen an expiration the past few years that has gone in such an orderly fashion," a floor broker said.

Key May SBK0 settled unchanged at 5.24 cents a lb after trading a tight seven-point range of 5.27-5.20 cents. Spot March inched up a miserly 0.01 to the day's high of 5.15 cents, with the session low at 5.09 cents. The rest went out flat to 0.03 cent firmer, except for July which dipped 0.01 to 5.51 cents.

Sugar started largely flat, as expected, and spent the rest of the session being jobbed between its trading range, brokers said.

Light trade buying kept sugar from falling out of bed, enabling most months to stay within a few ticks of unchanged.

Open interest in March as of February 22 dropped 4,072 to 35,001 lots while May's open interest rose 2,128 to 93,192.

"It's been spreads all the time. There's little else to talk about and it looks like we're going to stay this way until we get March out of the way," a dealer said.

Analysts said there has been no talk yet of the amount of sugar likely to be delivered against the tape in New York when March expires on Feb. 28.

"Like most years, Cargill and (ED & F) Man will be the major players in the March expiry," a broker said.

In industry news, the deputy head of the tariff policy department in the Trade Ministry of Russia, Yelena Bandura, told Reuters on Wednesday Moscow is mulling a series of measures to curb excessive raw sugar imports.

The Indian Sugar Mills Association said Wednesday the country's output in 1999/2000 (Oct/Sept) is expected to rise to about 17 million tonnes from 15.5 million.

Analyst F.O. Licht said the news, combined with the latest rise in sugar import duties to 60 from 40 percent, "means that the country will disappear as an import market for white sugar."

On a technical basis, market participants said May still faces resistance at 5.30 and in layers to the overhead gap at 5.62-5.65 cents. Support would be at the new lifetime low of 5.10, 5.00 and then 4.90 cents.

Estimated volume traded in the CSCE sugar market reached 30,998 lots, from the previous estimated volume of 29,683 lots. About 4,500-4,600 of the total would most probably be in AAs, traders said.

The CSCE is a subsidiary of the New York Board of Trade.-Reuters