January robusta coffee ended $11 lower at $1,336 a tonne on Wednesday. Market weighed by bearish technicals, which have led to selling by investors. March cocoa in London finished 22 pounds lower at 2,183 pounds a tonne. Weighed by producer and investor selling and strong pace of arrivals of new crop West African beans.
March white sugar in London ended up $7.80 at $626.80 a tonne, having earlier touched a record high of $629.0 on expectations of a strong appetite for refined sugar in India and Pakistan. Earlier, London (Liffe) benchmark white sugar futures jumped 1.5 percent on Wednesday to touch a record high of $629.0 per tonne, driven by expectations of strong physical demand for refined sugar from India and Pakistan.
Cocoa futures fell on origin and investor sales, while robusta coffee was steady amid a lack of producer selling from leading grower Vietnam. In sugar, India's growing appetite for whites was due to delays in production constraining mills' capacity to process raw sugar, and insufficient imports of raws to date during a period of high prices and negative import margins, dealers said.
"The engine in the sugar market is end-user demand, particularly for whites," said Nick Hungate, a soft commodities trader with Rabobank. "This is mainly Indian and Pakistani demand for white sugar." Hungate said white sugar futures had room for $20-30 per tonne upside in coming weeks, driven by South Asian demand. In cocoa, origin sales weighed on the market.
"Producer selling is starting to kick in cocoa," one London-based cocoa dealer said. Dealers focused on a strong pace of arrivals of new main crop cocoa beans in West Africa, but noted concerns over expectations of tight supplies from the next mid crop. In coffee, dealers talked of a constructive chart outlook after a strong performance in recent days. Dealers said fund buying had helped to fuel a run-up in arabicas with the benchmark March contract achieving its strongest settlement since November 9 on Tuesday.
The robusta coffee futures market will need to rise to trigger origin sales, traders said. "I think we need to come up so that we can get some Vietnamese selling coming in," one London-based robusta futures dealer said. "At the moment the Vietnamese are not selling because prices are too low."