Soft commodities mixed

Soft commodity futures were mixed Wednesday in two-way trading, with most players skittish from the pall cast by the gloomy economic outlook over the complex. Sugar and coffee ended mixed while cocoa finished higher. "I think people are cautious all-around," said Jack Scoville, a senior analyst at brokers The Price Group in Chicago. "A lot of it is because of the macro story."
Weak US and European data hurt stocks, corn, wheat and soybeans bounced from a two-day drop, and crude fell. "Aside from the grains markets and the fundamentals affecting sugar, the macro picture is none too constructive with increasing pressure on the euro as a result of debt in Spain," said Nick Penney of brokerage Sucden Financial.
Benchmark October sugar futures on ICE rose 0.08 cent to close at 23.57 cents per lb. October white sugar futures slipped 20 cents to end at $638 per tonne. Fundamentally, sugar players are still fretting over weather conditions in top producer Brazil and the weak monsoon afflicting No 2 grower India.
"Weather fears are the main concern - the kind of production we can expect in Brazil and India," said Sergey Gudoshnikov, a senior economist with the International Sugar Organisation (ISO). The key September arabica contract on ICE gained 0.85 cent to finish at $1.763 per lb. Robusta coffee futures on Liffe were slightly lower with September down $9 to settle at $2,149 per tonne.
Dealers said arabicas rose in a technical correction, supported by the weaker dollar, after falling 5 percent this week in its biggest one-day tumble in nine months. Drier weather in Brazil improved prospects for output in Brazil. Total open interest dropped by 1,460 lots to 135,078 lots on July 24, the lowest in five months. A Reuters poll showed coffee prices will likely resist pressure from the global surplus.
"In Brazil, hopes are growing meanwhile of an accelerated coffee harvest. To date, this has been delayed by heavy rainfall, which has also fuelled fears of quality losses," Commerzbank said in a market update. ICE September cocoa futures rose $21 or 0.95 percent to end at $2,230 a tonne. London September cocoa was up 13 pounds or 0.8 percent to finish at 1,553 pounds per tonne. Underpinning the market was dry weather in top grower Ivory Coast and the expectation for the El Nino weather phenomenon to materialise, which typically has a negative impact on the West African cocoa crop.