Arabica coffee makes biggest jump in a month

Arabica coffee futures on ICE made their biggest jump in a month on Monday, climbing above the prior session's 20-month low on chart-based buy signals and short-covering after data showed speculators had become heavily short.
Raw sugar futures turned lower after tapping a two-month high on the last official day of the index fund roll, which buoyed volume, while the October/December white sugar spread fell to its biggest discount in 6 -1/2 months ahead of the spot contract's expiry on Tuesday. Cocoa prices firmed on strong charts, with both the New York and London markets returning near technically overbought levels.
Arabica coffee jumped as funds covered their short positions, traders said, after data released late Friday showed speculators had increased their bearish position to the largest in six weeks days before prices fell to the lowest in more than 1 -1/2 years.
December arabica coffee settled up 3.65 cents, or 3.1 percent, at $1.202 per lb, after falling on Friday to the lowest since January 2014 at $1.16 a lb. Chart-based buying was also triggered above $1.18, traders said.
While the Brazilian currency firmed on the day and provided some support to arabica futures, the real's overall weakness may be causing farmers to delay some of their selling. "With the real getting weaker, if they hold coffee, it's protection for them against the devaluation of the currency there," said Rodrigo Costa, director of coffee for Societe Generale in New York.
Second-month robusta coffee futures settled up $35, or 2.3 percent at $1,587 per tonne, after matching the prior session's near-two-year low at $1,544. Under pinning the market were concerns about below-average rain in major sugar producers such as India, Thailand and Central America.
October raw sugar futures settled down 0.16 cent, or 1.4 percent, at 11.5 cents per lb, after touching 11.74 cents per pound, the highest since late July. October whites, which will expire on Tuesday, settled down $3.50, or 1 percent, at $342.60 per tonne, with open interest at 4,886 lots as of September 11. The contract fell to a discount of 12 cents against December, the biggest since early March. London December cocoa closed up 19 pounds, or 0.9 percent, at 2,206 pounds a tonne, while New York December cocoa settled up $32, or 1 percent, at $3,286 per tonne.