(Bloomberg) -- White sugar prices remain elevated, with the market flagging a substantial delivery against the Intercontinental Exchange's December contract. Arabica coffee extended its breakneck rally to the highest since 2012.
Open interest on December futures was last at 7,017 lots, equivalent to 350,850 tons of sugar. Last December's contract saw a 618,300-ton delivery.
“It looks like there will be a reasonably sizable delivery,” Marex sugar broker Anthony Sheridan said by phone. “There might be some other surprise origins in there, but it's most likely to be from India.”
White sugar for December last traded at $528.10 a ton and is at a $13.20 per ton premium to March futures, with the active contract trading close to four-year highs.
Prices in key importers China, Pakistan, Kenya and Egypt remain high, London brokers Marex said in an emailed note today.
“This means that stocks in these countries are low, so these importers will be forced to continue buying, so demand is ‘real' and will continue,” according to the note.
Meanwhile both robusta and arabica coffee advanced early Monday, with arabica touching $2.274/pound, the highest since 2012.
Arabica took out July and October peaks to trade at a seven-year high on Friday, with supply constraints in the world's top two coffee growers Brazil and Vietnam continuing to stretch a market deficit.
After that streak, the premium for arabica over robusta is trading at its most since 2012.
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