Soft commodities up

Sugar, coffee and cocoa futures prices increased in sympathy with other commodities on Thursday, and dealers anticipated further upside in sugar owing to tightening supplies in the world's number two producer India. "The rise in sugar futures is a reaction to smaller than expected Indian crops," said Romain Lathiere, fund manager with Diapason Commodities Management.
ICE October raw sugar futures rose 0.21 cent to 14.40 cents a lb at 1451 GMT. London October white sugar futures were up $4.9 or 1.2 percent to $400.8 a tonne. "There is a good pattern on New York sugar - we could go to 15.00-16.50 cents," Lathiere said.
London robusta futures also rose with other commodities, such as oil, although dealers said they were sceptical about comment from the Vietnamese trade that output in 2008/09 in the world's top grower would fall short of industry expectations. A Vietnamese industry official said on Wednesday coffee output in Vietnam would fall well short of industry estimates at 15 million bags in the harvest due to start in October.
But European coffee traders have voiced doubts over repeated Vietnamese insistence that supplies would be tight, saying production had grown in recent years with a larger area as farmers raised plantings to respond to rising prices.
London robusta futures have jumped 23 percent so far this year. Robustas look strong on technical charts and could move north on investor and fund buying, dealers said. London November robustas rose $12 to stand at $2,357 a tonne in volume of 3,273 lots at 1455 GMT. ICE September arabicas were up 2.55 cent or 1.9 percent to $1.4045 a lb.
Cocoa joined the move higher in softs, propelled by investor buying, although some dealers a further sell-off could be on the cards if the trade takes the view that favourable weather will benefit output in key growing countries such as Ivory Coast. London December cocoa was up 14 pounds to 1,503 pounds, while ICE December cocoa was up $33 or 1.2 percent to $2,818 a tonne.
Nestle, the world's largest food company, posted a 6 percent rise in its first-half net profit on Thursday and said it was accelerating its share buyback programme, but currency effects weighed on sales.