Arabica coffee up

ICE arabica coffee futures rallied the most in over a month on Friday, stemming a four-day slide on bullish technical signals and forecasts of cool weather in Brazil that heightened concerns of potential crop damage in the world's top producer. Cocoa on ICE Futures US eased from this week's nearly three-year high, as raw sugar futures ended little-changed.
Benchmark arabica coffee ICE futures soared as much as 9.75 cents, before ending the day up 6.4 cents, or 3.8 percent, at $1.7550 a lb, recovering sharply from Thursday's four-month low of $1.6655.
"We recovered from yesterday's lows on the close. The technical traders are feeding off the short-term moves, and others are jumping in looking for a bigger trend," said Hector Galvan, a senior softs broker at RJO Futures in Chicago.
Forecasts of cool weather across Brazil's coffee belt over the next two days added support.
Even with the day's gains, the second-month saw a slight weekly loss. It has slumped 20 percent from April's more than two-year high of $2.19 a lb, as uncertainty mounted about the extent of damage from a drought in Brazil earlier this year.
The September Liffe robusta coffee climbed $35, or 1.8 percent, to settle at $2,001 a tonne.
The ICE September cocoa contract closed down $8, or 0.3 percent, at $3,108 a tonne as investors booked end-of-week profits following a rally that lifted prices to $3,128 on Thursday, the highest since August 2011.
Speculators hold a historically large net long position in both the London and New York markets, betting on higher cocoa prices due to an expected third straight global supply deficit in the 2014/15 crop year.
The most recent buying spree has been driven by demand in the cocoa butter market and strong prices for the chocolate ingredient.
"The futures market has been watching the cash prices and the price of cocoa butter, but we may start to trade sideways without more news," said RJO's Galvan, noting that the industry's deficit expectations have been cut in recent weeks.
Liffe September cocoa edged up 2 pounds, or 0.1 percent, to settle at 1,935 pounds a tonne. The ICE July contract eased 0.02, or 0.1 percent, to end at 17.92 cents a lb, hovering below the prior session's one-month peak of 17.98 cents a lb.
Even as the week's buying rally cooled on Friday, the front-month finished the week up 5 percent in its biggest weekly rise since late March. Liffe August white sugar finished up $3, or 0.6 percent, at $491.50 a tonne after nosing up to a one-month high of $492.50.