Raw sugar futures on ICE eased on Friday, weighed down by forecasts for rain in top grower Brazil, while arabica coffee fell ahead of US and Brazilian holidays in heavy March/May spreading. Robusta coffee rose for the third straight session to a two-month high ahead of Tet holiday celebrations in top grower Vietnam. Cocoa futures nudged up to the highest in more than three weeks, supported by concerns over Ghanaian supplies.
The US softs market will be shut on Monday for the Presidents Day holiday, while Brazil will celebrate Carnival. In sugar, firm nearby demand initially boosted the spot contract's premium to 0.20 cent, reflecting tight supplies in the inter-crop period in No. 1 producer Brazil, but it later fell to flat. The March contract will expire on February 27.
ICE March raw sugar futures closed down 0.16 cent, or 1.1 percent, at 14.88 cents a lb, dropping from Thursday's two-week high at 15.05 cents. Traders said sugar was pressured by forecasts for weekend rains in Sao Paulo, Brazil's main sugar cane and important coffee producing state, Reuters Weather Dashboard showed.
In the white sugar market, a small delivery of below 200,000 tonnes is expected against the March contract's expiry on Friday, traders said. One London-based broker referred to talk that the delivery could be between 50,000 and 100,000 tonnes of Central American sugar, possibly including Guatemalan origin. London March white sugar futures settled down 60 cents, or 0.2 percent, at $382.80 per tonne. May arabica coffee ended down 0.95 cent, or 0.6 percent, at $1.665 per lb.
Volume was more than double the average on heavy March/May spreading ahead of the spot contract's first notice day on February 19, traders said. "The spreads have been unusually high and the March/May is creeping out," said Bob Phillips, president of Caturra Coffee Corp in Elmsford, NY. The spot contract's discount widened to around 3.3 cents, the biggest since December 9.
May robusta coffee ended up $16, or 0.8 percent, at $2,036 a tonne, after rising to $2,042, the highest since December 8. Most-active May New York cocoa on ICE closed up $12, or 0.4 percent, at $2,931 a tonne, after hitting the highest since January 20 at $2,933. May London cocoa futures ended up 2 pounds, or 0.1 percent, at 1,989 pounds a tonne.
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