Liffe December cocoa ended 1 pound higher at 2,034 pounds a tonne. Industry buying underpins market. Liffe November robusta coffee settled $16 higher at $1,788 per tonne. Difference between London and New York market remained historically wide. Liffe October white sugar futures ended $0.20 higher at $551.40 per tonne. Market supported by production problems in Russia and Pakistan.
"Funds are very long of the market, and whether the roasters are willing to get involved remains to be seen," a London-based coffee futures broker said. The difference between the arabica and robusta coffee markets has widened in recent weeks as Liffe robusta coffee has not tracked the gains in New York.
"That arbitrage can't go much wider," said a London-based coffee dealer. "We'll probably get a bit of a retracement in New York and London should go up in coming weeks." "Twenty cents may prove to be too large a hurdle to overcome in the short term," said Nick Penny of Sucden Financial Sugar.
"We believe that the area of support shown by the 200-day average at 18.62 cents, the 10-day average at 18.59 and the 20-day average at 18.58 will be tested before 20 cents." Dealers said that fund interest in the sugar market has waned due to a lack of clarity on India's crop prospects. A London-based broker said: "The really big boys who play the market are steering clear because of uncertainty over Indian production. If they could get more concrete figures out of India about what's happened there, the market could breach 20 cents."
Crop prospects in West Africa, the world's largest cocoa-producing region, have improved and weighed on cocoa prices. However, the downtrend in prices since mid-July has also triggered some industry buying, which has limited losses, dealers said. "Manufacturers have taken the opportunity to extend cover forward; otherwise you would have seen the market come off much more violently," a trader said.