LONDON: Raw sugar futures on ICE hit a two-week high on Thursday as Brazil’s real currency continued to firm and the Russia-Ukraine conflict kept oil prices above $120 a barrel. A strong real deters traders in Brazil from exporting dollar-priced sugar by lowering returns in local currency terms.
Higher energy prices prompt cane mills in Brazil to divert output from sugar to ethanol, a cane-based fuel.
SUGAR
May raw sugar rose 0.6% to 19.36 cents per lb at 1335 GMT, having hit a two-week peak of 19.50 cents.
Dealers said sugar is under pressure from rising output in India, adding that oil prices will only push sugar higher if they go back to the peaks of a fortnight ago.
Russia has simplified procedures for obtaining permits for white sugar imports as many Russians rush to buy sugar and other staples because of soaring food inflation.
Indonesia has appointed state-controlled companies to buy raw sugar to maintain price stability. May white sugar rose 0.6% to $551.60 a tonne.
COFFEE
May arabica coffee fell 0.8% to $2.2350 per lb, having hit a two-week high on Wednesday.
Dealers said demand is recovering in Asian markets as countries there ease coronavirus restrictions.
Rabobank has cut its projection for the Brazilian 2022/23 crop to 64.5 million bags from 66.5 million bags after a Brazilian farm tour that found the flowering last year “did not live up to its initial promise”. May robusta coffee fell 0.8% TO $2,121 a tonne, having hit a three-week high on Tuesday.
Robusta prices in top producer Vietnam edged up this week amid low stocks, with farmers having sold 80-90% of their beans for the season, while prices in Indonesia remained unchanged on scarce supplies ahead of a mini harvest.
COCOA
May London cocoa edged up 0.2% to 1,759 a tonne, having hit a one-week high on Wednesday. May New York cocoa slipped 0.3% to $2,323 a tonne.
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