Raw sugar slips

Raw sugar futures eased to their lowest level since the start of the month on Thursday, as pressure from the brisk pace of harvesting in top grower Brazil outweighed a pick-up in demand. Arabica coffee on ICE Futures US continued to move up from a five-month low, while cocoa was slightly higher. Mostly favourable weather in Brazil is aiding the cane harvest with progress well ahead of the same time last year.
"There's been a bit of rain but it wasn't too disruptive so there's huge progress in the crushing pace versus last year," said Kona Haque, head of research at ED&F Man. Signs of renewed physical buying prevented deeper losses, one trader said. ICE October raw sugar settled down 0.15 cent, or 0.9 percent, at 16.92 cents per lb, just above the session low at 16.87 cents, their lowest since June 30.
It remains unclear whether drought conditions in January and February could harm output in the latter stages of harvest however. "People are concerned about the tail end of the crop," Haque said. "We think there are risks that the agricultural yields will be revised lower." Liffe October white sugar dropped $2.60, or 0.6 percent, to finish at $450.20 per tonne.
A total of 254,300 tonnes of white sugar was delivered against the Liffe August contract, exchange data showed, slightly above expectations. In coffee, activity on the physical market was limited and dealers and analysts were awaiting more information on yields in Brazil after the drought earlier in the year sent prices soaring. "We expect New York to drop further, to be below $1.50 by the end of August," a European trader said. Benchmark September arabica futures on ICE closed up 1.35 cents, or 0.8 percent, at $1.6385 per lb, having hit a five-month low of $1.5925 on Tuesday. Liffe September robusta coffee ended down $10, or 0.5 percent, at $1,999 a tonne.
Cocoa dealers awaited the North American second-quarter grinding data, due at 4 pm EDT (2000 GMT), which are expected to be stronger than Europe's 0.7 percent fall. "The market would be doing well to show any significant rise, given the second quarter last year showed an exceptionally large increase," Justin Grandison, director of cocoa brokerage at ABN Amro Clearing Bank NV said. Expectations range from unchanged to 3 percent higher. ICE September cocoa settled up $2, or 0.07 percent, at $3,064 per tonne, while Liffe December cocoa edged up 2 pounds, or 0.1 percent, to end at 1,891 pounds a tonne. A total of 34,410 tonnes of cocoa was delivered against NYSE Liffe's July contract, exchange data showed.