Sugar climbs to fresh six-year high on global supply worries

Sugar extended gains to a fresh six-year high in New York as prospects for limited Indian exports added to worries about tight global supplies.

Raw sugar has rallied 5% this week on concerns about slower production in India and lackluster supplies from other countries including Pakistan and Thailand. Prices also have been supported by the potential for oil’s recent rally to spur Brazilian and Indian mills to divert more cane to making ethanol.

“Sugar has been taking off,” said Jack Scoville, a vice president at Price Futures Group. “The sugar production deficit is pretty big.”

India may not approve additional sugar exports in the year ending September with output likely below target, the nation’s food secretary said Thursday. Still, traders are looking to Brazil’s cane crushing and sugar output for the potential to ease market tightness.

Raw sugar rose as much as 2.2% to 23.46 cents a pound in New York, touching the highest since October 2016.