Decreases in demand and additional sources of supply next year painted a negative picture for Asia, a trader said.

"The outlook is not friendly. China is not going to buy in a big way. Russia is still a question mark. Indonesian demand will be lower and Pakistan is a net exporter," he said.

The trader said consumption in Indonesia was down and demand next year could be 15 per cent lower than this year, ranging from 800,000 to one million tonnes.

Pakistan, which has set an export level of 500,000 tonnes of white sugar, has so far sold 100,000 to 150,000 tonnes, mainly to India, Indonesia and East Africa, a trader said.

There was talk Indonesia was purchasing containers of Pakistani white sugar in shipments of several thousand tonnes each at $270 to $275 per tonne C&F Indonesia, traders said.

Premiums for Thai raw sugar, whichrose because of a dispute over prices among planters, millers and the government, would probably fall because of Latin American sugar imports competing in Asia, a trader said.

The Thai raw sugar premium over Coffee, Sugar and Cocoa Exchange prices for January/March was 45 points a lb bid.

The premium for March/May and May/July was 65 points bid.

Thai white sugar premium over London prices for February/March was $2 to $4 a tonne and for April/May $5 offered.

On Tuesday the Thai government set the initial sugar cane price at 600 baht per tonne, which was welcomed by planters who called off a protest at mills around Thailand.

The dispute "should not impact Thai premiums unless there is definitely a delay in the crush," a trader said.

Russia's import intentions were still unclear and could hurt Asia's market if Russian sugar imports decrease substantially because of that country's financial problems, traders said.

Cuban sugar which normally would go to Russia would come on to the world market,adding to supply, traders said. One trader said the Cuban sugar could be sold in Asia and compete with Thai sugar.

In China, some sugar mills were disregarding a government set price of 3,700 yuan ($447) per tonne and selling for 3,000 yuan, a trader said.

Chinese sugar mills, plagued by high costs, oversupply and weak demand, sold below the official price because they needed cash urgently, he said.