Raw sugar futures on ICE rose to their highest level in seven weeks on Wednesday, supported by broad-based commodity buying and concerns about cold crop weather in Brazil, the world's biggest producer, while cocoa prices rose after strong Asian grind data. October raw sugar settled up 0.4 cent, or 2.84 percent, at 14.5 cents per lb, after rising to 14.6 cents, the highest level since June 1.
The prior session's settlement above 14 cents attracted technical buying, which continued when the contract extended gains above the July 10 high of 14.39 cents, traders said. Traders said buying in broader commodity markets lent support, with the 19-market Thomson Reuters CoreCommodity Index at a seven-week high.
Market participants were monitoring weather in Brazil, where there were concerns about frost damaging some cane and low temperatures were forecast in the coming days. "Frost risk consequently remains," said Tobin Gorey of Commonwealth Bank of Australia in a market note. "How much damage the frosts can do is unclear."
October white sugar settled up $8.60, or 2.21 percent, at $398.60 per tonne. September London cocoa settled up 21 pounds, or 1.39 percent, at 1,533 pounds per tonne. September New York cocoa settled up $33, or 1.73 percent, at $1,944 per tonne.
Prices were supported by processing figures from Asia, which showed grindings increased in the second quarter by 9.9 percent year-on-year, less than expected, one trader said. The market awaited second-quarter North American grind data, set for release Thursday at 4 pm EDT (2000 GMT), with seven traders estimating a range of 1 percent lower to 3 percent higher. Most estimates were around 2 percent higher.
September arabica coffee settled up 0.9 cent, or 0.67 percent, at $1.358 per lb, after rising to a 10-week high at $1.3595. Traders kept a close eye on forecasts for cold weather in top-grower Brazil, providing light support. There was also concern about a possible spread of broca, insects that have the potential to damage the current crop and possibly the next crop, said Shawn Hackett, president of Hackett Financial Advisors in Boca Raton, Florida.
September robusta coffee settled down $21, or 0.99 percent, at $2,110 per tonne. A chunk of Brazilian conillon coffee has been tendered against the ICE futures market this month, as persistently high robusta prices this season have made the ageing beans more attractive to buyers.
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