December Liffe white sugar ended $19.50 lower at $589.80 per tonne, weighed by a broad-based downturn in crude oil and other commodities. Market remains underpinned by concerns about excessive rains in top producer Brazil. March cocoa ended 63 pounds lower at 2,008 pounds a tonne, weakened by losses in other commodity markets.
Hedge selling may also pick-up with the start of the Ivory Coast main crop season next week. November robusta coffee ended $20 higher at $1,383 per tonne, boosted partly by a weaker dollar. Coffee prices were higher, however, boosted by a weaker dollar while dealers also noted Deutsche Bank's rebalancing of its exchanged-traded commodity funds which should provide some support for arabicas.
Dealers said concern about heavy rains in top producer Brazil, as well as expected strong demand from India, should limit the scope for further losses. VM Group analyst Gary Mead said rains in Brazil had been unusually heavy in July and August, delaying the crush and lowering the sucrose content of cane, adding he saw no reason why prices should fall back sharply from the highs.
"We are entering into the rainy season now so the crush and the sucrose are going to be two big problems for the Brazilian crop this year," he said. Meteorlogix said on Friday "episodes of showers will impact harvest and crop quality (in Brazil)". Cocoa prices were also lower on Friday.
"The market has done exceptionally well this week so some sort of pullback in a bull market isn't unheard of and maybe that is what we are seeing at the moment," one dealer said. Dealers were awaiting the start of the main crop season in top producer Ivory Coast next week, adding the market would have to absorb significant hedge selling over the next few weeks.
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