London robusta coffee futures jumped nearly 2 percent on Tuesday, buoyed by expanding consumption and a weaker dollar, but concerns over global oversupply could curb gains in the days ahead. Cocoa futures continued to rally, setting a new 5-1/2-year high, while white sugar market consolidated gains near its two-month highs.
"There is a bullish underlying trend on consumption but on the back of the large (coffee) crop I think we are going to see the consolidation phase continue," said Philip Carlsson, analyst with Copenhagen-based Saxo Bank.
September robusta coffee settled up 1.8 percent, or $40, at $2,264 per tonne. Strength in other commodity markets such as crude oil is helping to drive the run-up in coffee but the market remains range-bound with resistance anticipated around the $2,300 level on September. Vietnamese coffee farmers are selling more beans this month to buy fertiliser, traders said on Tuesday. ICE July arabicas contract was up 2.60 cents at $1.3865 per lb at 1658 GMT.
Cocoa futures strengthened as concerns over bean quality and output in the main crop of top grower Ivory Coast continued to support prices. London benchmark September cocoa futures rose 6 pounds to touch a new multi-year high of 1,627 pounds a tonne. It finished at 1,625 pounds. US cocoa futures settled at a 28-year high Monday, on concerns about bean quality in top producer Ivory Coast and boosted by a commodity-wide rally, traders said.
Cocoa arrivals at ports in top grower Ivory Coast reached around 1,200,000 tonnes from October 1 to June 15, exporters estimated on Monday, up from 1,116,135 tonnes in the same period of the previous season. Ivory Coast cocoa beans registered for export in the 2007/08 season reached 1,066,922 tonnes by May 16, up from 966,325 tonnes by the same stage a year earlier, according to Coffee and Cocoa Bourse (BCC) data seen by Reuters on Monday.
White sugar futures took a breather after rising to near two-month high and soaring corn price could provide fresh impetus to the market. August finished up $2.5 at $373.5 a tonne. The contract peaked at $376.00 on Monday, the highest level for the front month since April 15. July raws on ICE rose 0.25 cents to 11.09 cents per lb at 1700 GMT.