Raw sugar turns up, cocoa down

Raw sugar futures on ICE turned higher after touching a six-year low on Wednesday, as the Brazilian currency steadied, while New York cocoa futures tumbled for the sixth straight session, falling in heavy volume on technical sell signals. Arabica coffee futures fell for the third straight session as selling in Brazil continued to be heavy, while robusta dropped to a 13-month low on pressure from the rallying US dollar.
Brazilian producers continued to sell as their weak currency still enabled them to make profits on the dollar-denominated sugar and coffee markets, though traders said this selling dried up in the sweetener as the real steadied. Front-month May raw sugar futures closed up 0.12 cent, or 0.9 percent, at 13.14 cents a lb, after dipping to 12.97 cents, the lowest for the spot contract since April 2009.
Traders spoke of some physical demand believed to be providing support later in the session. "The weak Brazilian real, improved weather conditions in growing areas in the center-south of Brazil and overall strength of the US dollar affecting commodities in general, continue to depress the sugar markets," said Nick Penney, senior trader with Sucden Financial Sugar, referring to earlier weakness.
May white sugar closed up $1.40, or 0.4 percent, at $371.80 a tonne. Arabica coffee dropped again as producers in Brazil continued to sell. May arabica coffee futures closed down 3.3 cents, or 2.4 percent, at $1.3175 per lb, near a 13-month low of $1.288 per lb touched on March 3. This is roughly 4.1 reals per pound, up roughly 20 percent from where prices were 13 months ago. Total open interest soared to the highest since March 2008 at 192,829 lots on Tuesday, having risen 14 out of the past 16 sessions.
May robusta coffee ended down $36, or 1.9 percent, at $1,820 a tonne. New York May cocoa ended down $58, or 2 percent, at $2,855 a tonne, weighed down by arbitrage selling, currency pressure and technical selling, traders said. May London cocoa finished down 25 pounds, or 1.2 percent, at 1,980 pounds a tonne.