White sugar futures touched a record peak on the last day of 2009 and raw sugar nudged near 29-year highs due to tight supplies. London cocoa ended the year up by over a quarter and robustas were down 14 percent. Sugar futures more than doubled in 2009 due to strong import demand from India, the world's top consumer, after a poor domestic harvest, and due to heavy and persistent rainfall during harvesting in top producer Brazil, which hit yields.
London (Liffe) benchmark front-month white sugar futures settled at the end of 2009 at $710.2 per tonne, up 123.3 percent from the last trading day of 2008. The close was just below a record high of $710.5 per tonne touched earlier in the session.
ICE March raw sugar futures were up 0.22 cent or 0.82 percent to 27.18 cents a lb at 1318 GMT, having reached a 29-year high of 27.49 cents on Tuesday, more than double the 11.81 cents a lb touched on the last trading day of 2008. "There's nothing to suggest that we've seen the top for this sugar rally yet," said Nick Hungate, a senior soft commodities trader with Rabobank.
"If the market goes to 30 cents a lb, then there's no reason why it can't go to 32 or 35 or even higher." Sugar prices should stay well-supported in 2010, powered by expectations of strong import demand in Asia, as well as Russia and the United States, dealers said. London benchmark second-month cocoa futures settled at the end of 2009 at 2,271 pounds per tonne, up 28.7 percent from the last trading day of 2008.
The surge in sterling-denominated London cocoa futures prices was driven by a weak pound, resilient demand for confectionery during the global economic downturn, and supply constraints in leading West African producers, dealers said. ICE March cocoa was up $54 or 1.66 percent to $3,301 per tonne at 1320 GMT. In a similar move to the London market, ICE benchmark cocoa futures were set to end the year up by around a quarter.
"I don't think demand has fallen as much as anticipated," Hungate said. "Cocoa, around these price levels, looks fairly valued: up or down 10 percent - I don't think either of these numbers would be a surprise." London second-month robusta coffee futures settled at the end of 2009 at $1,332 per tonne, down 13.8 percent from the last trading day of 2008. Robusta prices were weighed by ample supplies from top producer Vietnam, although arabica futures prices were set to end the year up around a quarter due to recent tight supplies of premium beans, notably Colombians.
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