Sugar futures prices surged to their highest levels in nine months Thursday amid rumors that China had come into possession of as much as 500,000 tons of sugar.
“What you saw was a market catching fire,” said Arthur Stevenson, analyst for Prudential-Bache Securities Inc., New York. “And the real excitement is the possible growing participation in the markets of China--the world’s most populous nation.”
On other markets, energy futures were mixed to marginally higher after three straight sessions of strong rallies; gold and silver futures dipped, but platinum rose, and livestock and pork futures edged lower.
Sugar settled 10 cents to 51 cents higher on the New York Coffee, Sugar & Cocoa Exchange, with the contract for delivery in May at 12.59 cents a pound.
Buying began with a rumor that the Chinese had bought between 150,000 and 500,000 tons of raw sugar from Thailand, though many traders cast doubts that the shipment exceeded 350,000 tons.
Many others traders said they believed that the Chinese actually bought the sugar last fall from Cuba and, learning the Soviets had made a similar-sized purchase from Thailand, simply swapped shipments to take advantage of economies in delivery of the sugar.
Also fueling the market was talk that the Brazilians had sold 100,000 tons and that Argentina was in the market for a large shipment.
Energy Prices Mixed
The climbing prices triggered a string of technical buy-stops--decisions made by price-chart considerations--and the market broke a “quadruple top” at 12.38 cents and continued rising.
Energy futures, which hit a 16-month high Monday and soared again in successive sessions, were mixed. Crude oil highlighted the complex, losing 5 cents at the opening on profit taking, and recovering gradually in light trading.
Crude oil settled 2 cents lower to 9 cents higher on the New York Mercantile Exchange, with April at $19.84 a barrel; heating oil was 0.02 cent to 0.36 cent lower, with April at 53.83 cents a gallon, and unleaded gasoline was 0.50 cent lower to 0.12 cent higher, with April at 55.83 cents a gallon.
Tables, Page 8