Soft commodities slip in London

Soft commodities extended losses on Friday, with ICE raw sugar futures falling over 5 percent, as commodities took their cue from external factors including the euro and stock markets. "It's all to do with the usual risk aversion; the euro is still getting hammered, equities are coming off as well, overall the sentiment is not very good," said Andrey Kryuchenkov, commodities analyst at VTB Capital.
The impact of a $1 trillion aid package to address euro zone debt has faded as deeper worries about sovereign debt keep nerves tight across markets, dealers said. "White sugar premiums have been rising again on growing enquiries from Pakistani and other Asian importers," said Kona Haque, commodities strategist at Macquarie Bank.
Dealers said Pakistan could come to the market for white sugar this weekend and Indian import demand is heating up on the expectation that the government will implement an import duty soon. New York's July raw sugar contract traded down .74 cents or 5 percent at 13.92 cents per lb as at 1516 GMT.
London's August white sugar contract traded down $11.50 or 2.4 percent at $463.00 per tonne. The raw sugar market is on track to post a weekly gain for the first time in 13 weeks as the market pauses, consolidating losses. Cocoa futures also extended losses Friday with ICE cocoa July contract trading down $72 or 2.4 percent at $2,841 per tonne.
Technical selling is driving down both the London and New York cocoa markets this week, seeing over 5 percent shaved off values. London July cocoa futures were down 31 pounds or 1.4 percent at 2,225 pounds per tonne.
Coffee markets are also lower as an expected record crop from Brazil, the world's largest producer, is bearish for prices. Brazil's 2010/11 crop is seen at 54 million 60-kilogram bags, up from 45 million bags the previous crop, said Macquarie Bank Friday. New York's July arabica coffee trades down 3.05 cents or 2.2 percent at $1.3405 per lb. London July robusta coffee trades down $23 or 1.6 percent to trade at $1,379 per tonne.