Sugar jumps on supply concerns in India, Australia

Sugar futures shot up to their highest levels in 30 years after news of lower crop yields in both Australia and India stoked fears that global demand will far outpace supplies.Sugar futures shot up to their highest levels in 30 years after news of lower crop yields in both Australia and India stoked fears that global demand will far outpace supplies.

Australia and India are the two biggest producers of sugar in the world and inclement weather in the two countries has left many farmers will damaged crops; moreover, Cyclone Yasi crossed the coast of Australia's Queensland state, ravaging crops and potentially costing farmers $505 million, according to a grower group. Indian output could also miss projections after heavy rains struck growing regions.Australia and India are the two biggest producers of sugar in the world and inclement weather in the two countries has left many farmers will damaged crops; moreover, Cyclone Yasi crossed the coast of Australia's Queensland state, ravaging crops and potentially costing farmers $505 million, according to a grower group. Indian output could also miss projections after heavy rains struck growing regions.

Jason Cole, a broker at Starsupply Renewables, told Bloomberg the "cyclone is the story." An extended run-up in prices could depend on the severity of damage to sugar crops in Oz, he said.Jason Cole, a broker at Starsupply Renewables, told Bloomberg the "cyclone is the story." An extended run-up in prices could depend on the severity of damage to sugar crops in Oz, he said.

Wednesday on the New York Mercantile Exchange, sugar for March delivery climbed 4.2 percent, or 1.42 cents, to settle at 35.38 cents per pound. In London, refined-sugar futures for March delivery rose 3.8 percent, or $31, to close at $850.20 per metric ton on NYSE Liffe.Wednesday on the New York Mercantile Exchange, sugar for March delivery climbed 4.2 percent, or 1.42 cents, to settle at 35.38 cents per pound. In London, refined-sugar futures for March delivery rose 3.8 percent, or $31, to close at $850.20 per metric ton on NYSE Liffe.

Yasi is the first category 5 cyclone to hit Queensland since 1918, Bloomberg reports. Sugar futures have more than doubled since the end of June on supply concerns.  Yasi is the first category 5 cyclone to hit Queensland since 1918, Bloomberg reports. Sugar futures have more than doubled since the end of June on supply concerns.