:. Food Industry News


Sugar, Cocoa Rise; Rice Rebounds from GMO Sell-Off

Source: Reuters
24/08/2006

New York, Aug 23 - U.S. sugar rose 3 percent after hitting a nine-day peak on Wednesday amid speculative buying while cocoa ended nearly 1 percent higher after sliding to a three-month low that drew fresh demand.

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Rice futures staged a modest comeback after two days of sharp declines triggered by the detection of an unapproved biotech variety of rice in regular U.S. supplies. Coffee fell after touching a three-month top, weighed by producer selling.

Copper and gold remained under pressure for a second straight day due to weak buying leads. Oil fell after U.S. government data showed an unexpected rise last week in crude inventories in the world's top gasoline consuming country.

The Reuters/Jefferies CRB Total Returns Index .CRBTR> -- which tracks 19 commodity futures ranging from oil to metals, cotton, coffee, grains, livestock and frozen concentrated orange juice -- was down 0.58 percent at 334.71 at 2030 GMT.

The Goldman Sachs' GSCI Total Returns .GTX> -- an index heavily reliant on oil -- slid 1.41 percent to 6,727.73.

Sugar prices on the New York Board of Trade (NYBOT) soared through key technical levels when speculative buying set off several automatic buy orders.

NYBOT raw sugar contract for October SBV6> delivery settled up 0.35 cent at 12.41 cents a lb., after surging to 12.57 cents, its highest level since Aug. 14.

Last Thursday, benchmark sugar futures tumbled to an 8-1/2-month low after weeks of persistent selling. Traders said on Tuesday they thought selling had been exhausted when the key support level held.

Cocoa finished on positive ground, with light speculative buying amid a sliding dollar helping the market recover from a three-month bottom hit earlier in the session.

NYBOT's benchmark cocoa for December CCZ6> settled up $13 at $1,534 a tonne after trading from $1,511 to $1,539. The bottom trade was the contract's weakest price since April 17.

Coffee futures at the New York Board of Trade were weighed by producer selling after prices hit three-month highs.

"We did see some producer selling, primarily from Colombia and a little from Brazil," a coffee trader at a large commodity trade house said.

December coffee KCZ6> fell 1.25 cents to $1.1135 a lb.

Rice futures at the Chicago Board of Trade rebounded from sharp losses this week amid easing concerns over exports.

The commingling of biotech rice with commercial supplies in some southern states continued to overhang the market, although a move by Europe seemed to indicate that there might not be any major halt in sales to the region.

The European Commission on Wednesday decided to require imports of long grain rice from the United States to be free of the unapproved biotech variety, called LL Rice 601.

"It's not a ban on imports. That's a good development," said Milo Hamilton, an analyst with Firstgrain.com, a rice market advisory service in Austin, Texas. "If they want testing, the U.S. is totally in favor of that."

CBOT November rice 3RRX6> rose 9 cents to $9.44 a cwt.



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