London white sugar futures finished sharply lower on Wednesday, weakened by producer selling and widespread profit-taking after the market's strong recent advance, dealers said. December closed down $18.40 or 4.4 percent at $403.60 a tonne after trading in a range of $427.00 to $401.90.
Total volume was 5,621 lots. Dealers said the market had become heavily overbought following the recent sharp advance in prices. December rose to a two-month high of $427.40 on Tuesday and had climbed almost $60 in the past two weeks.
"There was no reason for the market to be so high. No fundamentals have changed," one dealer said, adding the rise in prices had attracted producer selling while the fund buying which helped to fuel the advance was not evident on Wednesday.
Cargill sees a global sugar surplus of 3.3 million tonnes in 2006/07, with a production increase mostly coming from Asia, an economist with the US agri-food giant said on Wednesday.
COCOA CLOSES LOWER: London cocoa futures closed lower on Wednesday, weakened by profit-taking and renewed speculative selling as a short-lived rally ran out of steam, dealers said. December finished 14 pounds lower at 816 pounds a tonne, while March ended down 13 pounds at 833.
March had dipped to 825 pounds on Tuesday, the lowest for the second month since November 2005, but then rallied with the second month climbing as high as 861 pounds on Wednesday.
COFFEE TICKS UP: London robusta coffee futures were little changed by midsession on Wednesday, with trading dominated by November/January spreads as funds continued to roll positions forward. By 1123 GMT, November futures edged up $1 to $1,496 a tonne, while second position January was $3 firmer at $1,492.
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