NEW YORK/LONDON: Arabica and robusta coffee futures on ICE closed down on Tuesday after hitting fresh 10-year highs earlier in the session thanks to container shipping bottlenecks, falling stocks, lower output prospects and upbeat sentiment in the wider financial markets.

COFFEE

March arabica coffee settled down 6.55 cents, or 2.6%, at $2.433 per lb after rising earlier to $2.5235, the highest since 2011.

March robusta coffee fell $42, or 1.8%, at $2,273 a tonne, having earlier hit $2,334, also the highest since 2011.

Arabica is being boosted by expectations that output from top producer Brazil will slide this season and the next following the drought and frost that hit the country’s arabica growing areas earlier this year.

Stocks of the bean on the ICE exchange are currently near their lowest levels in almost a year, with global container shipping backlogs and rising freight costs making the exchange the cheapest source of supply.

“Through technical studies we can see some projections into (the) $2.75 area. I think that is very likely in the short term,” said Cardiff Coffee trading in a note.

Output of washed arabica in Colombia, the world’s top producer of the high-end bean on which the ICE contract is based, fell 22% year on year in November to 1.13 million 60-kg bags.

SUGAR

March raw sugar rose 1.6% to 19.48 cents per lb, a week high.

Dealers said the market continues to be led by the trend in energy and the broader financial markets.

Waning Omicron COVID-19 variant worries and a timely booster shot of Chinese stimulus lifted world stock markets and oil on Tuesday.

“The contract is perhaps on its way back to putting in a reasonable bid for Indian raws,” said Commonwealth Bank of Australia, referring to the price level further up that will attract exports of Indian sugar.

March white sugar rose 1.4% to $503.40 a tonne.

COCOA

March New York cocoa settled up $25, or 1.0%, to $2,485 a tonne.

Rains were below average last week in most of top producer Ivory Coast’s cocoa-growing regions, with more needed to ensure the harvest is strong in February and March, farmers said. March London cocoa rose 7 pounds, or 0.4%, to 1,699 pounds per tonne.