Liffe January robusta coffee ended $60 higher at $2,046 per tonne on Monday after hitting a two-year peak of $2,058. Market supported by concern about rains in top producer Vietnam. Liffe December white sugar ended $4.60 higher at $780.70 per tonne. Market consolidating just below Friday's 30-year peak for the front month of $783.90.
Liffe second-month March cocoa ended 42 pounds higher at 1,857 pounds a tonne. Market rebounded strongly after earlier dipping to 1,798 pounds, the lowest level for the second month since August 2009. "The robusta market, having ended last week strongly, was looking good technically today," said Andrea Thompson, analyst with CoffeeNetwork.
"The ongoing rainfall in Vietnam - and a report today that the rains are expected to continue - is supporting the market," she added. Rain is likely to persist in Vietnam's Central Highlands coffee belt throughout this month and the rainy season is expected to end in late November, a month later than usual, a state forecaster said on Monday.
Sugar futures fell, weighed by the stronger dollar, consolidating after surging to a 30-year high on Friday. The sugar market was supported by tight export availability from top producers Brazil and India. The sugar market was focused on an expected decision by India later this month on whether to allow so-called "open general licence" (OGL) exports to the world market.
Some dealers said India was expected to approve sugar exports incrementally. Indian industry expects sugar exports of some 2.5 million to 3.5 million tonnes in 2010/11 and has lobbied authorities to approve 2 million tonnes of OGL exports, analysts say. Some dealers said the raw sugar futures market has the potential to rise to 35-40 cents a lb in the medium term, but others said it risks being overbought due to a lack of physical offtake at current high prices.
"The arbitrage between the two markets is tightening, suggesting that further selling pressure is coming to London," a London cocoa futures dealer said. Dealers saw near-term support in London second-month cocoa at 1,800 pounds and then at 1,733 pounds.
Dealers were focused on the election in Ivory Coast, which they said appeared to be progressing smoothly, auguring for a steady flow of exports to the world market. Expectations of big main crops in West Africa also weighed on the price outlook, they said.