BUZZ-Sugar: Berenberg picks Agrana, AB Foods over Suedzucker

** Berenberg says it still struggles to see real long-term value in Suedzucker (Other OTC: SUEZF - news) shares and prefers more diversified names such as Associated British Foods (LSE: ABF.L - news) and Suedzucker's listed Austrian subsidiary Agrana

** "Given its lower exposure to volatile commodity areas of sugar and bioethanol compared to Suedzucker, Agrana's earnings, margins and cash flows have been consistently steadier than its parent - neither reaching the same peaks in 2012/13 nor the lows of 2015/16," Berenberg analysts say in a note

** They see a placement of a 5 pct stake in Agrana by Suedzucker as possible soon, which would raise the free float to 12 pct from 7 pct

** Cut their price target for Suedzucker to 12.70 from 13.50 euros, citing management's cautious 2017 guidance, and affirm their "sell" rating

** They maintain their "hold" rating and 90 euro price target for Agrana and say an increase in liquidity and free float through a placement of shares by Suedzucker would be needed for a re-rating

** Suedzucker shares are down 1.4 pct in early trading, their lowest level in almost four months. Agrana is up 0.2 pct and AB Foods is up 0.9 pct (RM (LSE: RM.L - news) : maria.sheahan.thomsonreuters.com@reuters.net)