LONDON: Arabica coffee futures on ICE climbed on Wednesday, pulling away from the prior session's three-month low, boosted by a stronger currency in top-grower Brazil, while cocoa rose for its third positive finish in 22 sessions.
COFFEE
December arabica coffee settled up 1.4 cent, or 1.5pc, at 96.65 cents per lb.The market was supported by a firmer currency in Brazil, which helped the contract pull away from the three-month low of 93.40 cents hit on Tuesday.
A stronger Brazilian currency discourages producer selling of dollar-denominated commodities such as coffee and sugar.
Prices were also underpinned by a diminishing outlook for next year's crop in Brazil following adverse weather.
"The unsettled weather and an extremely cold July have apparently damaged many trees, though some are reported to have blossomed prematurely in recent weeks.
The blossoms could be shed in the high temperatures that are forecast for September, which would reduce the potential yields," Commerzbank said in a market note.November robusta coffee settled up $4, or 0.3pc, at $1,328 per tonne.
COCOA
December New York cocoa settled up $33, or 1.6pc, at $2,207 per tonne, rebounding from a five-month low of $2,165 reached on Tuesday.
This was its best daily performance in about a month.
Expectations of plentiful supplies in the 2019/20 season due to good weather in top-growing region West Africa have been pressuring the market of late, dealers said.
The contract has been technically oversold on the relative strength index for the past two weeks following a prolonged slide in prices.
Concern about the health of the global economy, which can effect cocoa demand, has also been a worry, dealers said.
December London cocoa settled up 25 pounds, or 1.5pc, at 1,723 pounds per tonne, in its biggest daily percentage gain since July 22.
SUGAR
October raw sugar settled down 0.05 cent, or 0.4pc, at 11.39 cents per lb.
Prices have been range-bound in recent sessions, as the market waited for a decision from India's government on the terms under which it will extend its export subsidy system until September 2020.
October white sugar settled down $1.20, or 0.4pc, at $307.90 per tonne.
Russia cut its white sugar exports sharply in the 12 months to July 30, but may lift them significantly in the new season due to weak domestic prices, said IKAR, one of the leading agriculture consultancies in Moscow.
Comments
Comments are closed.