According to The Australian Financial Review, the entitlement issue will be launched either today or tomorrow to raise around $400 million and interest from international institutions, attracted by the soon to be demerged sugar business, is likely to be strong.

CSR said in June it was studying a spin-off of its sugar and renewable energy business from its building, aluminum and property units and a move to tap investors was always on the cards given a debt-to-equity ratio of 70.1 per cent.

Jonathan Drake, Cargill's global head of sugar trading, said in an interview with the Financial Times last week that the shortage that caused the sugar-price rally was far worse than that in 1973-74 or 1980-81.

Drake said the price, which has more than doubled this year to 25¢ a pound, might climb as high as 40¢, judging from those earlier shortages.

The sugar rally was the result of a large supply deficit due to disappointing crops in Brazil and India, the world's top producers, he added.