Robusta coffee futures on ICE fell to a six-month low on Tuesday and the nearby premium declined on diminishing concern about nearby supply tightness, while raw sugar consolidated near the prior session's three-month high. January robusta coffee settled down $32, or 1.68 percent, at $1,878 per tonne after falling to $1,873, the weakest for the second-position contract since April 25.
The second position closed October lower, marking fourth straight monthly decline. The move pushed the November contract's premium to January to a session low of $14 from a peak this month of $61. A steady decline in the November contract's open interest ahead of Wednesday's first notice day has reduced concern over potential tightness in tenderable supplies, dealers said.
Dealers said they monitored weather in top robusta producer Vietnam, where intermittent rainfall could delay the harvest. December arabica coffee settled down 0.8 cent, or 0.6 percent, at $1.251 per lb. The spot contract closed October down 2.3 percent, the third straight month lower. World coffee exports rose to a record in 2016-17, International Coffee Organization data showed.
March raw sugar settled up 0.01 cent, or 0.07 percent, at 14.74 cents per lb, just below Monday's three-month high. The spot contract closed the month up 8.9 percent. Dealers said producer selling stalled the run-up in prices that linked to a rise in ethanol values in Brazil, which reduced the amount of cane being used to produce sugar.
"The market is consolidating gains but it remains to be seen whether a further step upwards can be made," said Sucden Financial senior trader Nick Penney, adding that trends in energy or currency markets could fuel further gains. "Technically the market trading range seems to have risen 50 points to the 14.50 to 15.00 parameters, with strong technical resistance approaching either end," said James Liddiard of consultancy Agrilion in a market note.
March white sugar settled up $1.10, or 0.3 percent, at $384.80 per tonne. The global sugar market is poised for a 2017-18 surplus of 9.8 million tonnes, Australia-based analyst Green Pool said. December London cocoa settled down 18 pounds, or 1.2 percent, at 1,553 pounds per tonne. Dealers said that generally favourable weather in top producer Ivory Coast pressured prices. March New York cocoa settled down $22, or 1 percent, at $2,089 per tonne. The second-position contract closed the month up 2.7 percent.
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