Sugar and robusta coffee futures fell on Thursday, weighed by a stronger dollar and lower oil prices, with the sugar trade's attention focused on expiry of the ICE October contract the previous day. December white sugar ended $8.70 lower at $609.30 per tonne on Thursday, having earlier touched a lifetime peak for the front month of $621.00.
Market is underpinned by nagging concerns about rains during harvesting in top producer Brazil. March cocoa ended 29 pounds lower at 2,071 pounds a tonne, having earlier hit a contract high of 2,108 pounds. Market remains supported by improving demand prospects and supply concerns in top producer Ivory Coast.
November robusta coffee ended $23 lower at $1,363 per tonne, pressured by the stronger dollar. Market focus is on the coming robusta crop in top producer Vietnam, which is expected to weigh on prices. Sugar brokers and traders pegged total deliveries for the expired contract at about 1.01 million tonnes. The exchange will release actual deliveries later on Thursday.
Traders said they believed agro-industry giant Cargill was a receiver. "Generally we see a little bit of a setback after an expiry," one London-based sugar trader said. "The market has only weakened a bit. There may have been some profit-taking." A robusta coffee futures trader said, "Coffee is overbought. The dollar is having a downward effect on the market."
Earlier, Liffe December white sugar was down $6.9 to $611.1 per tonne, having earlier touched a lifetime high basis front month of $621.00, in thin volume of 2,036 lots. High cocoa futures prices had deterred industry buyers, and the stronger dollar contributed to investor selling, dealers said.
Concerns over the size and quality of the main crop harvest in top grower Ivory Coast, and expectations of improving demand, have contributed to a 20 percent rise in benchmark ICE cocoa futures so far this year. Macquarie Bank said in a research note on cocoa on Thursday, "The jury is still out on whether 2009/10 will be in (global) surplus or deficit (our own supply/demand balance points to another small deficit.)"