By M. Shankar Dec. 8 (Bloomberg) -- White sugar rose for the first time in four sessions in London on speculation that lower-than- expected production in Brazil may worsen a global supply deficit. Output in the nation’s Center South, the world’s largest producing region, is estimated at 28.9 million metric tons in the current season, according to FCStone Group Inc. That’s down from 29.3 million tons projected on Nov. 16. Excess rainfall has hurt the harvest in Brazil, the biggest producer. “Most of the cut came as a result of rains in October and November,” Ricardo Nogueira, an analyst with Kansas City-based FCStone, said in a phone interview yesterday from Campinas, Brazil. White, or refined, sugar for March delivery climbed $3.40, or 0.6 percent, to $620.30 a ton on the Liffe exchange at 11:29 a.m. local time. The contract gained as much as 0.9 percent, the most since Dec. 4. Raw sugar for March delivery advanced 0.3 percent to 22.52 cents a pound on ICE Futures U.S. in New York. Refined sweetener has surged 95 percent this year as global supply failed to keep pace with demand. Drought in India, the second-largest producer, hampered cane output as well as storms in Brazil. Indonesia plans to import 500,000 tons of white sugar to meet domestic demand as 2009 output is estimated to come below forecast, the Trade Ministry said. Worldwide sugar use will exceed output by 13.5 million tons in the 2009-10 season, broker Czarnikow Ltd. said last month. Scattered showers in the western Bahia region of Brazil in coming days will delay the harvest, weather forecaster AccuWeather.com said in a report dated yesterday. Coffee, Cocoa Among other agricultural commodities traded on Liffe, robusta coffee for January delivery slid $17, or 1.2 percent, to $1,360 a ton. A global supply deficit for coffee is likely to widen in the year that began Oct. 1, Nestor Osorio, executive director of the International Coffee Organization, said at a conference in Ho Chi Minh City today. He predicted supply of 123 million to 125 million bags and consumption of 132 million bags. “The weather has been erratic,” Osorio said. “January and February will be crucial for the Brazilian harvest, and also for Vietnam.” Growers in Brazil, the world’s biggest producer, will likely supply about 39 million bags in the current crop year, below last year’s 46 million bags, Osorio said. Higher Prices Production in Vietnam, the second-largest producer globally and the biggest robusta grower, may slump as much as 20 percent to 17.5 million bags, Luong Van Tu, chairman of the Vietnam Coffee and Cocoa Association, said in an interview. “We expect coffee prices to rise during coming months,” Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt, wrote in a report e-mailed today. Cocoa for March delivery advanced 1 pound to 2,244 pounds ($3,668) a ton. A government committee set up to reorganize the cocoa industry in Ivory Coast, the biggest producer of the chocolate ingredient, recommended a reduced role for private companies, said an official with knowledge of the proposals. To contact the reporter on this story: M. Shankar in London at mshankar@bloomberg.net

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