Liffe August white sugar ended down $24.30 at $852.00 a tonne on Thursday after earlier plummeting over 3 percent to $843.10. The market tracked weakness in New York sugar as investor selling dragged down prices. Liffe September robusta coffee ended $25 lower at $2,306 a tonne, large European stocks weigh.
Liffe September cocoa ended 10 pounds lower at 1,976 pounds a tonne as weakness in other commodity markets weighs on the softs complex. "It's heavily loaded with speculators, everyone's long and everyone wants to sell it so if there's a sign of weakness people are going to jump on the back of it," a London-based broker said, adding the market could collapse further from here.
The market remained, however, underpinned by diminishing crop prospects in top producer Brazil, with the country's cane industry group revising lower its cane output estimates on Wednesday. "The lower sugar output in Brazil, the world's largest producer and exporter, should be reflected in a lower global supply surplus," Commerzbank said in a daily report.
"We do not expect prices to top the 30 cent mark on a lasting basis, however, given the outlook of rising sugar output in other major producing countries such as India and Thailand." "It is expected that the delivery will be small, consisting of Thai, Brazil and possibly Indian refined sugars," Nick Penney at Sucden Financial said.
"Over the next couple of weeks expect cocoa to continue trading sideways," said a London-based broker, adding the market's focus was on the 2011/12 supply outlook. "I'm not hearing that people have strong convictions of next year's production yet." Grindings had been expected to be slightly positive as additional capacity was utilised in Europe after Ivory Coast capacity was closed for part of the quarter due to conflict in the world's top grower. Telvent DTN said on Thursday there was favourable harvest weather for the coffee crop across Brazil and no damaging cold was expected.
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