FT922-12623
_AN-CDPBOADHFT
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416
FT 16 APR 92 / Commodities and Agriculture: Supply f
ears buoy sugar prices
By DAVID BLACKWELL
FEARS OF a tighter sugar supply/demand balance in 1992-93 are support
ing the
world market, according to reports from two London trade houses.
Raw
sugar prices have recently touched eight-month highs, nudging 10 cents a
lb
in the New York market, on fears of tight nearby supplies following
damage
to the South African crop because of drought.
The trade houses, ED & F. Man
and Czarnikow, both point out in reports
published today that in the short t
erm the changing export potential in
several countries will keep the lid on
prices. The increasing likelihood of
a 1m-tonne increase in Thailand's crop,
compared with the previous season,
together with the availability of export
able surpluses from India and Cuba,
should 'keep significant advances at bay
', Man's latest sugar report says.
Man believes that reports of a catastroph
ic Cuban crop this season at 5m to
5.5m tonnes are unsupported by the eviden
ce and estimates that the crop will
come in at about 6.5m tonnes. It is fore
casting a crop of more than 5m
tonnes in Thailand and 12.6m tonnes in India.
The overall balance for the 1991-92 season remains marginally in surplus,
M
an says, but it suggests that the situation is likely to be even more
tightl
y balanced in 1992-93.
Czarnikow's sugar review points out that the extent o
f the South African
drought has raised questions about the timing and covera
ge of the El Nino
weather phenomenon.
'Already a major drought is developing
in Thailand which, if relief does not
arrive this month, could have serious
implications for the next crop,' the
Czarnikow review says. 'If this is par
t of a regional phenomenon there might
be problems later in the year with th
e monsoon in India and this will need
to be monitored carefully.'
The Financial Times
London Page 38
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