Sugar Prices Move Lower, Wednesday, August 29, 2007 2:05:53 PM
Sugar prices were down on Wednesday in U.S. trading amid further speculation that the Indian government will step in to help the country`s producers of the commodity. Sugar for October delivery traded at 9.42 cents a pound, down 3 cents for the session, on the New York Board of Trade. Prices have been falling for the last three weeks.According to the International Sugar Organization, India is expected to bypass Brazil as the world`s leading sugar producer. On Tuesday, the Indian government said it might help pay sugar-cane producers. This would allow exporters to take lower prices. A surplus of 10.8 million tons is expected for the sugar market is reportedly expected.
Also on the NYBOT, cocoa, cotton and orange juice are up for the day. Coffee prices are down. Among agriculture products, corn prices have also moved lower, but soybeans, wheat, milk, cattle and cotton all saw a rise.
Crude oil prices surged after the Energy Information Administration released its report on U.S. oil inventories in the week ended August 24 on Wednesday, showing that crude oil and gasoline inventories fell by much more than analysts had expected. Light sweet crude for October settlement was up $1.58 to $73.31. Oil reached as high as $73.39, its highest mark in two weeks in afternoon trading. The rally helped oil erase the losses it saw on Tuesday when it snapped a streak of four straight winning sessions.
The EIA`s weekly inventory report showed that crude oil inventories fell by 3.49 million barrels following an unexpected increase of 1.89 million barrels in the previous week. Analysts had been expecting a much more modest decline of about 1 million barrels. Gasoline inventories also showed a notable decrease, falling by 3.67 million barrels after falling by 5.71 million barrels in the week ended August 17. The decrease far exceeded analyst estimates of a drop of less than 1 million barrels.
Gold prices gained in early U.S. trading Wednesday, after falling in its two previous sessions. December-dated gold was at $675.40, up $1.90. The U.S. dollar continued to see weakness throughout the morning against both the euro and sterling. The greenback`s weakness also helped the price of silver, which gained 9 cents to move at $11.85. Overall, silver has been range-bound for 12 days.
The inventory report also pushed the prices of RBOB gasoline, which added 3.96 to trade at $2.055. Gasoline for September delivery touched a 26-day high of $2.0608 earlier in the morning. Heating oil also rose, adding 7.96 cents to move at $2.0950. September-dated heating oil touched a two-week high of $2.0426in morning activity.
The economic calendar was light in the U.S. on Wednesday. Traders are looking ahead to several key reports on Thursday. Included on the schedule will be GDP price index data for the second quarter as well as weekly jobless claims figures. Friday will bring the release of PCE deflator data.
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posted by Kalin Tasev @ 2:27 PM
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