A weak pound supported London cocoa futures on Wednesday, while robustas eased on profit-taking and white sugar futures fell due to a lack of physical offtake, dealers said. A weak pound, dragged lower by expectations of a Bank of England rate cut, drove benchmark May London cocoa futures to a new four-and-a-half year high of 1,244 pounds, and traders noted active position rolling.
May cocoa was up 6 pounds at 1,243 pounds in modest volume of 2,918 lots by 1333 GMT. Sterling fell to a two-week low versus the dollar and eased against the euro on Wednesday as investors positioned for a widely-expected Bank of England interest rate cut on Thursday. Dealers saw an upside target of $1,350 pounds in May and support at around 1,200.
Nigeria has banned cocoa farmers from using about 20 agro-chemicals in a bid to comply with European Union quality regulations, the state news agency reported on Tuesday.
London white sugar futures fell on position rolling and a lack of physical offtake ahead of expiry of March on February 14, dealers said. March sugar was down $2.70 to $327.50 per tonne in moderate volume of 3,791 lots at 1334 GMT. March has fallen after rising to a peak of $361.00 on January 18, the highest level for the front month since December 2006.
Dealers said weak demand in the physical market after a run-up in prices had reduced interest in taking delivery, encouraging longs to liquidate. US food producers and business groups are seeking to block a proposal from sugar producers that would limit trade with Mexico, just weeks after free trade in sweeteners began in earnest under the North American trade deal, Nafta.
Robusta coffee futures weakened on profit taking in light turnover after this week's 10-1/2-year highs. May coffee was down $8 to $2,176 per tonne in light volume of 1,314 lots at 1334 GMT.
The contract touched $2,190 a tonne on both Monday and Tuesday, the highest level for the second month since June 1997. Traders also referred to active position rolling in March-May. Sara Lee Corp on Wednesday posted a second-quarter profit versus a year-earlier loss as the weaker dollar, new products and increased spending on marketing helped boost sales.