LONDON: Arabica coffee futures retreated from last week's seven-month high on Tuesday and raw sugar prices fell on signs a weekend cold snap in Brazil may have done less crop damage than feared.
COFFEE
September arabica coffee was down 0.3 cents, or 0.3pc, at $1.0610 per lb by 1330 GMT. The market had touched a seven-month peak of $1.1565 on Friday.
Brazil's Cooxupe, the world's largest coffee cooperative, said it would release a report on Wednesday with its initial evaluation of frosts reported in coffee regions over the weekend.
The frost threat had sparked a short-covering rally.
Speculators reduced net short position in arabica coffee in the week to July 2 to the lowest since October 2017, US government data showed on Monday. {nL2N249101]
Dealers said market fundamentals remained bearish, with global consumption rising but not fast enough to absorb increased production in recent years, particularly in Brazil.
"Although global consumption is continuing to rise, it's difficult to construe a bullish picture at this point," said Stefan Uhlenbrock, senior commodity analyst at IHS Markit's Agribusiness Intelligence.
"The rise is still only small and the ample availability of coffee in the coming months is likely to keep bearish sentiment alive for the time being," he said.
September robusta coffee rose $6, or 0.4pc, to $1,432 a tonne.
SUGAR
October raw sugar was down 0.14 cents, or 1.1pc, at 12.31 cents per lb.
Dealers said any damage to cane from weekend frosts in Brazil was likely to be minor although a clearer assessment was expected towards the end of this week.
"Uncertainty over damage from frosts last weekend and perhaps on frosts to come may serve as a reminder to the bears that they will not always have things their own way," said Nick Penney, senior trader with Sucden Financial.
"However, in the short term, there is plentiful supply of both raws and whites, reflected in the (record high) July NY delivery," he added.
August white sugar fell $3.00, or 0.9pc, to $318.50 a tonne.
COCOA
September London cocoa fell 44 pounds, or 2.3pc, to 1,891 pounds a tonne, retreating from Monday's one-year high of 1,939 pounds.
Dealers continued to await clarity on a plan by top producers Ivory Coast and Ghana to introduce mechanisms such as a price floor to bolster the market.
September New York cocoa fell $48, or 1.9pc, to $2,529 a tonne.
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