Arabica coffee hits three-month high, cocoa visits one-month top
- September arabica coffee settled up 1.95 cents, or 1.8%, at $1.116 per lb, having hit its highest since late-April.
- December London cocoa settled up 29 pounds, or 1.8%, at 1,611 pounds per tonne, having hit a one-month top of 1,620.
NEW YORK/LONDON: Arabica coffee prices on ICE hit three-month highs on Wednesday as the Brazilian real strengthened and concerns grew over prospects for Central American output, while robusta coffee hit a seven-month top amid a coronavirus outbreak in Vietnam.
COFFEE
September arabica coffee settled up 1.95 cents, or 1.8%, at $1.116 per lb, having hit its highest since late-April.
Arabica is benefiting from a strengthening Brazilian real , which deters exporters from selling dollar-priced coffee by lowering their real-based returns, and as concerns grow that lockdowns and low prices could hurt Central American output.
Starbucks said business is steadily recovering worldwide as most of its coffee stores have reopened after reporting a 40% sales decline in the quarter ended June 28.
September robusta coffee settled up $8, or 0.6%, at $1,344 a tonne, having hit its highest since December.
Top robusta producer Vietnam will shut bars and ban large gatherings from midnight amid a new COVID-19 outbreak.
Vietnam's coffee exports in the first seven months of the year are expected to have dropped 1.4% from a year earlier to 1.06 million tonnes, government data showed.
COCOA
December London cocoa settled up 29 pounds, or 1.8%, at 1,611 pounds per tonne, having hit a one-month top of 1,620.
Cocoa is consolidating after hitting a near two-year low in mid-July, though fundamentals remain weak.
Rabobank said it expects the North America, Asia and Europe third-quarter cocoa grind, a measure of demand, to fall between 4.5% and 5% as economies struggle to fully reopen following coronavirus lockdowns.
It expects demand to recover slowly next year, growing at just 1.6% as second waves of the virus are expected, while production will likely increase between 2% and 3% amid benign weather conditions.
September New York cocoa settled up $50, or 2.2%, at $2,341 a tonne.
SUGAR
October raw sugar was little changed at 12.01 cents per lb, after peaking at 12.27 cents on Tuesday, the highest since July 8.
Dealers said the market is consolidating after sharp gains earlier in the week on the back of fresh demand news.
October white sugar settled up $2.10, or 0.6%, at $365.00 a tonne.
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