LONDON, April 12: London white sugar futures touched a 2-1/2-week high on Thursday, lifted by trade short covering and structural activity before the expiry of the front-month May contract on Friday.

May was up $7.00 or 2.07 per cent at $345.00 per ton at 1124 GMT, the highest since March 26, in brisk volume of 1,920 lots.

August was up $3.20 at $323.20 in volume of 2,025 lots after trading from $323.80 to $320.50.

A dealer said that, based on the large open interest, the delivery against the May expiry could be a large one, but he asked who would wish to receive sugar when freight rates were so high.

Merchant ED&F Man sold 25,000 tons of 45-ICUMSA white sugar to Tunisia for a prompt May-June shipment, for around $400 per ton for cost and freight, according to a trade source.

Dealers said the bearish backdrop to sugar prices had largely been factored into the market.

The International Sugar Organization's (ISO) chief said on Thursday that world sugar prices were likely to fall even further this year. Peter Baron's comments reinforced the ISO's statement last week, which said it could widen its 2006/07 global sugar surplus projection to 8.5-9.0 million tons. — Reuters