London robusta coffee ended slightly higher on Friday in heavy volume as traders rolled forward positions ahead of first tender day, dealers said. Cocoa rebounded from a recent six-month low on short covering ahead of the long holiday weekend in the United States while white sugar ended little changed.
Robusta coffee trading was dominated by rolling forward of positions out of front month September ahead of Monday's first tender day. Benchmark November ended $4 higher at $1,718 a tonne. The contract has held in a narrow band of $1,687 to $1,738 this week. "We are looking rangebound at the moment," one dealer said.
Total volume was a heavy 26,420 lots. Dealers said the prospect of another large Vietnamese crop was weighing on the market and could drive prices down later this year.
"There are quite a lot of reasons to sell it," one dealer said. White sugar futures ended steady with the market holding just above its recent 21-month low although the mood remained bearish, weighed down by a large global supply glut.
Dealers said that market's downtrend appeared, however, to have temporarily lost momentum. "Values are not eroding on a daily basis and this can only mean that everyone is already positioned for a drop," brokers Sucden UK said in a daily market report.
The prospect of more sales by India remained a key bearish influence. India farm minister Sharad Pawar said earlier this week that a group of ministers would meet in the next few days to work out export incentives for sugar mills that were struggling with a market glut and low prices.
October whites ended up $0.80 at $279.50 a tonne. The contract dipped to $272.00 on August 16, a 21-month low for the front month. Egypt's state-owned Sugar and Integrated Industries Company (SIIC) has tendered to buy 80,000 tonnes of raw sugar, trade sources said on Friday.
Cocoa futures finished higher, boosted by industry buying with the market underpinned by concern about the possible impact of black pod disease in top producer Ivory Coast. Dealers said prices were also boosted by short covering ahead of the long holiday weekend in the US as the market continued its slow recovery from Tuesday's six-month low.
Benchmark December ended 17 pounds higher at 966 pounds a tonne. The contract touched a six-month low of 931 pounds, basis second position, on Tuesday. Dealers said the market remained on the defensive despite the modest advance on Friday with overall crop prospects in West Africa remaining favourable. Physical cocoa buying is expected to pick up in the fourth quarter and industry are hoping for further price falls from this week's 6-month low in London cocoa futures, dealers said on Friday.
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