NY cocoa hits nine-month high; sugar falls

NEW YORK/LONDON: New York cocoa hit a nine-month high on Tuesday, boosted by continuing tightness in nearby supply in the physical and futures markets, while sugar prices fell.

COCOA

March New York cocoa settled up $32, or 1.2%, at $2,785 a tonne, having touched a contract high of $2,821, the highest level since February.

New York cocoa has risen for seven days running as supplies grew tight after US chocolate maker Hershey Co positioned itself to receive an unusually large amount of beans from the ICE exchange.

Dealers said the rally could settle down in due course because it has prompted some profit taking, and there have been reports of selling, albeit modest, from top producers Ivory Coast and Ghana.

March London cocoa settled up 19 pounds, or 1%, at a two-month high of 1,854 pounds a tonne.

SUGAR

March raw sugar fell 0.09 cents, or 0.1%, to 15.04 cents per lb after hitting a nine-month high last week.

Indian sugar mills have for the first time in three years agreed to export the sweetener without the support of government subsidies as they scramble to pay dues owing to farmers, sources told Reuters.

India, the world's second-biggest sugar producer, uses subsidies to encourage exports of its surplus sugar and ensure mills make payments to cane farmers. Disagreements among ministers have delayed announcement of its export subsidy this season, which has all but halted exports and helped to drive up global prices.

March white sugar fell $2.90, or 0.8%, to $408.60 a tonne.

Indonesia's 2021 white sugar output is estimated at 2.2 million tonnes, slightly lower than the 2020 forecast of 2.23 million tonnes, the deputy economic minister said.

COFFEE

March arabica coffee settled down 1.15 cents, or 1%, at $1.159 per lb, edging further away from Thursday's two-month high.

Arabica remains under pressure from this season's record crop in top producer Brazil, though the country's coffee belt is expected to see dry weather again in 6-10 days time, forecaster Maxar said, reigniting fears over next season's crop.

January robusta coffee settled down $25, or 1.8%, at $1,353 a tonne.