Thai raw sugar premiums strengthened this week after a sharp drop in New York futures spurred buying interest from consumers in Asia, but Indian white sugar prices slipped due to abundant supply, dealers said on Tuesday.
Indonesia has yet to return to the physical market after chasing Thai raws to make up for a white sugar shortage.
Dealers said PT PPI, the state-run firm appointed to import the sweetener, had bought around 180,000 tonnes of Thai raw sugar so far.
Premiums for Thai high-polarisation, or hi-pol, raw sugar rose to between 70 and 80 points to the May contract from 65 points last week after the New York market ended at a four-month low on the prospect of bumper supplies in top producer Brazil.
"There are bits and pieces of buying from everywhere.
It's mainly from industrial users in Southeast Asia.
We are wondering whether the government will extend the deadline for the imports of sugar to Indonesia," said a dealer in Singapore.
"If they buy it today, it's not possible for the sugar to reach Indonesia by April 30th because Thailand is still in a holiday mood.
Nobody is really working in Thailand," said the dealer, referring to the recent Songkran water festival.
Jakarta has appointed PT PPI to import 240,000 tonnes of raw sugar, which will be processed into whites.
The sweetener has to arrive in Indonesia by April, a month before local crushing starts.
Thai white sugar premiums were quoted at between $23 and $27 a tonne to the new front-month contract in London, August .
Premiums were as little as $4 to the then front-month May contract last week.
The white sugar market has been under pressure from rising supply in Thailand and also India, which is on track to achieve all-time high sugar exports over two straight seasons, according to commodities house Czarnikow.
Indian white sugar prices dropped to around $600 a tonne from as high as $630 last week because of ample supply.
India, the world's largest consumer, is expected to see a surplus of 4 million tonnes in the current 2011/12 crop year.
"Low quality Indian sugar is now at $600 a tonne or below.
I see the price coming down.
But I also heard some people are selling Indian whites at $15 premiums over London's August contract," said another dealer in Singapore.
NYSE Liffe said that 263,950 tonnes of white sugar had been delivered against expiry of the London May white sugar futures contract.
The delivery included 125,000 tonnes of Indian sugar, one of the largest deliveries of Indian sugar in recent memory.