London benchmark sugar futures closed down almost two percent on speculative and fund selling on Monday, reversing gains made on Friday, dealers said. May settled down $6.50 or 1.86 percent at $342.50 per tonne in volume of 4,010 lots, after trading from $348.80 to $340.30.
Total volume was 6,044 lots. "First there was producer selling and then specs and funds hit sell stops, wiping out the gains from Friday," one dealer said, referring to a surge in white sugar futures on Friday to 2-1/2-month highs. Another trader said, "The specs who were buying are now selling." On ICE, NYBOT May raw sugar futures were down 0.53 cent to 10.69 cents per lb at 1754 GMT.
F.O. Licht on Monday raised its forecast for 2006/07 (October-September) global sugar output to 161.8 million tonnes from a previous projection of 160.0 million and an estimated 152.1 million tonnes in 2005/06.
COFFEE ENDS LOWER: London robusta coffee futures closed weaker on Monday after setting a fresh 2-1/2 month low on fund selling and plentiful supplies, dealers said.
Benchmark May closed down $36 at $1,460 a tonne after falling to $1,457, the lowest for the second month since mid-December. Total volume was a heavier-than-normal 25,410 lots. Dealers noted fund selling was seen in both London and New York with US arabica futures falling on Monday to a four-month low.
COCOA STEADIES: London cocoa futures closed little changed on Monday after the market eased back from a fresh seven-month peak buoyed by a weaker pound, dealers said.
Benchmark May settled down one pound at 988 pounds per tonne having touched 997 pounds in the morning, a seven-month peak for the second position. Dealers said they were surprised the market was not stronger given sterling's weakness. Dealers said the supportive impact of a weak pound was offset by sharp losses in New York futures. May cocoa in New York was down $23 at $1,781 a tonne in electronic trading at 1713 GMT on Monday.