ICE arabica coffee futures rose from a 5-1/2 low on Wednesday as year-end buying boosted prices to a 50 percent rise for the year as a drought in top grower Brazil boosted arabica to the biggest annual gain on a 19-commodity index. Raw sugar inched down to a three-month low on pressure from weak oil prices, ending the year down 11.5 percent due to hefty stocks. It was sugar's fourth straight annual decline.
New York cocoa futures tumbled 2 percent a day after the latest Commitment of Traders report showed a surge in new speculative long positions. The spot contract finished 2014 with its third straight annual gain. Trading volume was thin ahead of the New Year's Day holiday on Thursday.
Arabica coffee futures had a volatile year as a drought damaged crops in Brazil, lifting prices to 2-1/2 year highs in early October. Since then, prices have slumped as rains in Brazil reduced fears over damage to the 2015/16 crop. Still, arabica notched the biggest annual gain by far on the Thomson Reuters CoreCommodity CRB Index, a benchmark for 19 commodity markets. The front-month March arabica coffee contract settled with a daily gain of 1.8 cents, or 1.1 percent, at $1.6660 cents a lb, after falling to $1.64, its lowest since July 18.
"The funds are still long coffee and they're going to try to mark their book for year-end as best they can," said Nick Gentile, managing partner of commodity trading advisor NickJen Capital in New York. March robusta coffee settled up $10 at $1,916 per tonne, ending the year up 13.8 percent, its strongest performance since 2010, underpinned by robust global demand.
Front-month March raw sugar turned lower, closing down 0.09 cent, or 0.6 percent, at 14.52 cents a lb, after falling to the lowest since September 24 at 14.47 cents. It finished 2014 down 11.5 percent, marking its fourth straight annual loss. "We expect oversupply to continue into the first half of 2015, but some market relief in a tightening global balance for 2015/16," said Tom McNeill of Green Pool Commodities.
March white sugar closed up $4.10, or 1.1 percent, to $391.20 per tonne, ending the year down 12.9 percent, also its fourth straight year lower. New York March cocoa tumbled $62, or 2.1 percent, to close at $2,910 per tonne. For the year, it rose 7.4 percent. London May cocoa fell 4 pounds to settle at 1,953 pounds per tonne, up 13.1 percent year-on-year in 2014, also rising for the third straight year.
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