Sugar prices closed up 4.2 percent at 3-1/2 month highs on Tuesday, on lower-than-expected crush data in top grower Brazil, while arabica coffee prices vaulted after a minor Brazilian coffee region was hit by frost. Cocoa settled up a shade in quiet trade.
Brazil's Centre-South sugarcane crush was down 23 percent in mid-June, compared with a year ago, at 134.6 million tonnes, cane industry association Unica said, releasing a figure that was below expectations. "The market is not catching up with the late start to the harvest," said Jeff Bauml, a senior vice president with brokerage R.J. O'Brien & Associates in New York.
The data buoyed sugar futures, with the spot contract extending its premium to a 3-1/2 month high of 2.27 cents per lb against the second position. The spot contract will expire on Thursday. "There has been a great deal of short-covering on the front New York spread, on August whites and on flat price," Nick Penney at Sucden said.
ICE October raw sugar futures surged 1.1 cents, or 4.2 percent, to finish at 27.01, the highest close for the second position since March 9, after reaching a session high 27.23 cents a lb. The sweeteners were already strong before the data, getting a lift from the weak US dollar and strong energy complex.
ICE arabica coffee futures rallied over 3 percent after frost reached at least two minor coffee regions in top grower Brazil's Parana state, although it was unlikely to put a major dent in next year's output. ICE September arabica coffee jumped 7.85 cents, or 3.1 percent, to close at $2.5890 per lb. Cocoa settled firm in quiet dealings as many dealers sat on the sidelines to see the market's next move after the US market moved above $3,000 per tonne. September cocoa on ICE closed up $23 at $3,023 a tonne.
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