LONDON: Raw sugar on ICE slid to a four-year low on Friday and was poised to end the week down 7 percent to extend a seven-week rout amid plentiful near-term supplies as Brazil harvests a big crop and global inventories swell.
Arabica coffee on ICE futures US fell on increased expectations that crop damage due to a Brazil drought will lessen next season, and cocoa futures rose.
The spot ICE October raw sugar contract sank as low as 13.86 cents and was down 0.42 cents or 2.9 percent at 13.94 cents a lb by 12:23 p.m. EDT (1623 GMT).
The US dollar extended its rally against the Brazilian real, weighing on sugar and arabica coffee futures as it incentivizes exporters in the world's top producer of both to sell more of the dollar-traded commodities.
Weak appetite to take delivery of sugar against the October contract, which expires on Sept. 30, kept volumes heavy as traders liquidated and rolled forward positions.
The spot raw sugar discount against the second-month shot to 2.51 cents a lb, its biggest since at least November 2005, according to the oldest data compiled by Reuters.
Talk mounted of a large volume of fairly low quality Thai sugar available for delivery.
"Buyers are just not buying. You have all this sugar hanging over the market," said Nick Gentile, managing partner of commodity trading adviser NickJen Capital in New York. Prices have fallen 60 percent from a 2011 peak around 36 cents a lb as world output has soared and stocks surged.
Liffe October white sugar, which expires on Monday, fell $6.10, or 1.5 percent, at $390.30 a tonne after hitting $386.60, a contract low and the weakest level for the front month since April 2009.
December arabica coffee futures on ICE eased 0.55 cent, or 0.3 percent, at $1.8490 per lb, headed for the largest weekly loss since May.
Brazil's coffee crop is likely to jump 10 percent to 48.8 million bags in 2015, the government's crop supply agency said on Thursday after the market closed.
That followed a higher industry forecast last week, which has cooled the momentum of a recent rally seen on worries over the impact of drought in Brazil this year and next year. November robusta coffee futures on Liffe rose $10, or 0.5 percent, to $1,998 a tonne.
In cocoa, the ICE December contract closed up $25, or 0.8 percent, at $3,053 a tonne, bouncing up from Thursday's more than three-month low of $3,019.
December cocoa futures in London finished up 25 pounds, or 1.3 percent, at 1,994 pounds a tonne, supported by industry buying after a 3-percent price drop from a late August peak of 2,061 pounds.
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