LONDON: Arabica coffee futures on ICE rose to the highest level in more than three years on Tuesday with supplies set to tighten over the next few months, while raw sugar climbed to a two-month peak.
July arabica coffee was up 0.4 cents, or 0.3%, to $1.4375 per lb by 1348 GMT. The benchmark second position peaked at $1.4480, its highest since August 2017.
Commerzbank noted in a daily update the crop in top producer Brazil, where the harvest has begun, was expected to fall 30% short of last year.
Demand is also beginning to revive as speedy vaccinations in the United States and China make customers more comfortable with returning to their morning coffee runs.
“New York (arabica coffee) is...at its highest level since August 2017, boosted by the deficits expected in 2021/22,” Commerzbank added.
Dealers said the recent breach of resistance levels, including a peak for the July contract of $1.4220 set in February, had helped to generate technically-driven buying.
July robusta coffee rose by $7, or 0.5%, to $1,447 a tonne.
May raw sugar was up 0.15 cents, or 0.9%, at 17.32 cents per lb after peaking at 17.40 cents, its highest since Feb. 26.
Dealers said drier-than-normal weather had added to concerns about Brazil’s crop development.
“Momentum remains strong and will likely only encourage further buying,” Commonwealth Bank of Australia analyst Tobin Gorey said in a note, adding the market had breached recent resistance during trading on Monday.
August white sugar rose by $2.80, or 0.6%, to $468.30 a tonne.
July New York cocoa fell by $13, or 0.5%, to $2,474 a tonne, weighed by excess supplies.
July London cocoa fell by 8 pounds, or 0.5%, to 1,646 pounds a tonne.
Comments
Comments are closed.