New York, June 24 - Dealers were pondering Wednesday if India, the world's biggest consumer of sugar, will need to import more of the sweetener because of faltering monsoon rains.
India's government said its annual monsoon rains, the lifeblood of its trillion dollar farm economy, were expected to be below normal in 2009.
"If they produce less (sugar), they would have to come to the market," a senior sugar broker said.
The U.S. Agriculture Department had estimated India's 2009/10 sugar imports would reach 2.5 million tonnes.
Trade house Sucden pegged India's 2009/10 sugar consumption at 23.5 million tonnes and production at 20 million tonnes, which meant the country would again "require substantial imports."
"The implication is that they would need to import more sugar because their production will take a hit. The question is if they can come up with the financing to do so," another dealer said.
The benchmark October raw sugar contract in New York surged to a three-year peak of 17.38 cents per lb Wednesday. And the March 2010 raw sugar contract hit a contract high of 18.24 cents.