Raw sugar up, arabica dips

Raw sugar futures on ICE inched further above last week's seven-year low on Tuesday, as the market consolidated after falling more than 3 percent on Monday, while arabica coffee eased under pressure frrom a weak Brazilian currency Cocoa futures rose. Soft commodity markets marched to the beat of their own drum on mixed fundamental signals, while world stocks and other commodity markets dropped on poor Chinese data that intensified fears about China's economic health.
The 19-market Thomson Reuters CoreCommodity Index fell 3 percent, after surging 9 percent in the prior three sessions, with oil prices tumbling 7 percent. October raw sugar settled up 0.02 cent, or 0.2 percent, at 10.71 cents per pound.
Sugar prices were influenced by a variety of factors, with abundant supplies in Asia applying pressure and potential weather problems providing support, traders said. A weak real boosts the incentive for Brazilian producer sales of raw sugar and arabica coffee because it maximizes local currency returns. "With the index funds rolling of the spot October position still to come, I would not be surprised if the 10.00 cents a lb level was tested at some point," a London-based broker said.
October white sugar settled down $5.10, or 1.5 percent, at $336.3 per tonne. Hot, dry weather gripping Brazil's south-eastern states will favour this week's harvesting of coffee and sugar cane in Brazil, the world's No 1 producer of the crops, meteorologists said. In arabica coffee, futures eased, pressured by the softening real, with traders focused on the weather in Brazil as the harvest wraps up.
December arabica settled down by 3.5 cents, or 2.8 percent loss, at $1.208 per pound, near last week's 1-1/2-year low at $1.2025. November robusta coffee settled down $8, or 0.5 percent, at $1,603 per tonne. "Slowly, Vietnamese producers are letting go of old crop as the new crop gets closer," said Carlos Mera, a senior commodities analyst at Rabobank. December New York cocoa settled up $42, or 1.4 percent gain, at $3,141 per tonne, while December London cocoa settled up 25 pounds, or 1.2 percent, at 2,126 pounds per tonne.