Sugar and coffee tumble

Raw sugar and arabica coffee futures on ICE slid to their lowest levels in nearly two years on Friday as broad selling across commodity markets accelerated downtrends linked to abundant supply. Raw sugar futures fell with other financial markets as economic woes pressured the sweetener, already weighed down by ample supplies. Bargain-hunting and some consumer buying provided a measure of support for raws, brokers said.
"At the beginning of the downward move on sugar I think people were looking at the fundamentals, but now it is just a matter of following other investors," said Romain Lathiere, head of dealing at Diapason Commodities Management.
ICE July sugar futures dropped 0.33 cent, or 1.7 percent, to close at 19.09 cents per lb, the spot contract's lowest settlement since August 2010. Earlier, the contract touched 18.95 cents. "With the Brazilian real and Indian rupee having already crashed, local sugar prices remain very attractive, and that should keep selling pressure high and keep the incentive to promote strong future production," analyst Shawn Hackett of Hackett Financial Advisors said in a market note.
The Liffe soft commodity markets will be shut on Monday and Tuesday to mark Queen Elizabeth's 60th year on the British throne. Sterling Smith, vice president of commodity research at Citibank's Institutional Client Group in Chicago, said fears over the euro zone combined with nervousness about a holiday weekend in Britain had piled pressure on financial markets, including softs. London August white sugar dropped $5.10, or 0.9 percent, to end at $553.50 per tonne.
Arabica coffee futures on ICE dropped to their lowest level since July 2010. Brazilian agriculture consultancy Safras & Mercado estimates the world's top coffee producer will harvest 54.9 million 60-kg bags of beans in the 2012/13 crop, which endured overly dry weather through its development. July arabicas on ICE fell 3.15 cents, or 2 percent, to settle at $1.5750 per lb, the lowest settlement since July 2010 for the spot position.
Robusta coffee futures on Liffe joined the retreat, with September dropping $19, or 0.9 percent, to close at $2,143 per tonne.
Robusta bean exports in May from Indonesia's main growing area in Sumatra slumped 54 percent to 9,355.3 tonnes from a year earlier. US cocoa futures also fell, with ICE July down $20 at $2,063 a tonne, the weakest settlement for the spot contract since January 6. The contract sank 2.7 percent earlier to $2,026. September cocoa on Liffe dropped 17 pounds, or 1.2 percent, to end at 1,451 pounds a tonne.