Arabica coffee closes sharply down; raw sugar drifts lower
- Raw sugar futures on ICE were slightly lower, while New York cocoa futures shot up.
- October raw sugar settled down 0.01 cent, or 0.1%, at 11.72 cents per lb.
- December London cocoa settled up 6 pounds, or 0.4%, to 1,569 pounds per tonne.
NEW YORK/LONDON: Arabica coffee futures closed sharply down on Monday on ICE, erasing the large gains seen on Friday as fears about a cold front over Brazilian coffee fields dissipated.
Raw sugar futures on ICE were slightly lower, while New York cocoa futures shot up.
SUGAR
October raw sugar settled down 0.01 cent, or 0.1%, at 11.72 cents per lb.
Dealers said the market remained stuck well within its recent range of 11.30 cents to 12.30 cents.
A trend toward increasing the use of cane in Center-South Brazil to make sugar rather than ethanol continued to ensure the market was well supplied. Demand for biofuel ethanol in Brazil has been weakened by the COVID-19 pandemic.
"The consensus interpretation, we think, is that Centre-South Brazil is heading like a sleep-walker towards maximum sugar, it is now effectively too late to change the sugar mix significantly; so we are going to end this year with a substantial surplus," broker Marex Spectron said in a report.
October white sugar settled down $1.90, or 0.5%, at $350.50 a tonne.
COCOA
December London cocoa settled up 6 pounds, or 0.4%, to 1,569 pounds per tonne.
Dealers said the market remained on the defensive, weighed by weak demand and a generally favorable outlook for main crops in West Africa.
Speculators increased their net short positions in both London and New York cocoa futures in the week to July 14.
September New York cocoa settled up $59, or 2.7%, to $2,219 a tonne.
COFFEE
September arabica coffee settled down 2.55 cents, or 2.5%, at 99.75 cents per lb.
Prices rose sharply on Friday, boosted by fund short covering triggered partly by concerns that a cold front could bring frosts to some coffee areas in Brazil, but dealers said those fears have basically dissipated, leading to losses on Monday.
Costa Rican coffee production is expected to rise 8.2% in the upcoming harvest beginning in August, according to estimates from the national coffee institute (ICAFE) on Friday.
September robusta coffee settled down $15, or 1.2%, at $1,278 a tonne.
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