Raw sugar finished near a 9-month high while arabica coffee futures jumped on Tuesday, boosted by poor weather in several growing areas and the dollar gaining on China's surprise decision to raise interest rates. Cocoa fell in modest dealings, dealers said. Sugar looks set to break above the psychological 30 cents a lb milestone as fundamentals and technical signals support high prices.
Weakness in other currencies like the Brazilian real brought on by the Chinese move to raise interest rates on Wednesday gave a boost to both sugar and coffee, products in which Brazil is the world's leading grower and exporter. New York's March raw sugar contract rose 0.75 cent or by 2.72 percent to end at 28.33 cents per lb in the highest close on the spot daily charts since early February.
New York's December arabica coffee futures climbed 5.30 cents or by 2.8 percent to settle at $1.909 per lb. Arabica futures remained within reach of the 13-year high hit last month of $1.9865 a lb after investors piled in on tight supplies of high quality arabicas. The key December cocoa contract in New York dropped $44 to settle at $2,750 per tonne.