Raw sugar futures on ICE turned lower in a late-day selling spree after vaulting 5 percent to the highest in more than four years on Thursday, initially buoyed by a weaker dollar and supply concerns in top grower Brazil. Coffee futures rallied to 19-month highs, though the arabica market also turned lower late in the session, while cocoa prices held firm. Broad-based buying gave the markets early strength as the 19-market Thomson Reuters CoreCommodity Index hit a four-week peak in its sixth straight session higher.
March raws settled down 0.09 cent, or 0.4 percent, at 22.67 cents per lb, trading in a wide range of 1.34 cents after surging to 23.88 cents, the highest for the second month since July 2012. The October/March spread briefly narrowed to the smallest discount in six weeks ahead of the October contract's expiry next Friday.
"The market is very concentrated on the spread. It's broken out of its recent range, which could mean the large delivery that people are expecting could be getting trimmed back," said Michael McDougall, director of commodities for Societe Generale in New York. "It's being helped by the deterioration that people are beginning to note in the Brazilian cane crop." December white sugar futures settled up $1.20, or 0.2 percent, at $591.70 per tonne.
"Yesterday's US Fed meeting which confirmed that rates are going to stay low a little longer gave the cue for the funds to pile up again, safe in the knowledge that the dollar's not likely to strengthen much in the short term," said Kona Haque, head of research at commodities house ED&F Man. Robusta coffee rose to a 19-month high as traders focused on supply concerns in top producers Brazil and Vietnam. November robusta settled up $16, or 0.8 percent, at $2,002 per tonne, after hitting $2,028, the highest level for the benchmark second position since February 2015.
December arabica settled down 1.3 cent, or 0.8 percent, at $1.5525 per lb, after climbing to $1.641, also the highest since February 2015. This volatile turnaround marked a potentially bearish technical pattern, soaring above the prior session's high and then closing before its low, as they broke a three-day streak higher. December London cocoa settled up 12 pounds, or 0.5 percent, at 2,320 pounds per tonne, while December New York cocoa settled up $43, or 1.5 percent, at $2,920 per tonne.
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