Raw sugar futures on ICE turned lower after hitting a three-week high on Friday, loosing upward momentum after extending a rebound above the 50-day moving average. Cocoa also dipped, touching the lowest level in months, while arabica coffee remained on track for its biggest yearly decline since 2000. Overall volume in the softs complex remained thin with many dealers away from their desks between the Christmas Day holiday on Tuesday and the upcoming New Year holiday on Jan. 1.
Raw sugar futures have been rebounding from a drop earlier this month to the lowest levels in more than two years. Cocoa has dropped every day for more than a week after a fall below the 200-day moving averages in mid-December triggered technical sell signals. Arabica coffee is on track for the weakest annual performance of the 19 commodities on the Thomson Reuters-Jefferies CRB index. March raw sugar futures on ICE closed down 0.03 cent, or 0.2 percent, at 19.42 cents a lb, after hitting a three-week high of 19.58 cents.
The market sank to 18.31 cents earlier this month, its lowest since August 2010. Prices have been pressured by rising stocks as production has outpaced demand. March white sugar on Liffe changed direction and closed down 40 cents, or 0.08 percent, at $522.00 per tonne. Cocoa prices were slightly lower with March futures on ICE closing down $6, or 0.3 percent, at $2,249 per tonne its lowest settlement since July 25. The contract closed lower for the ninth straight session.
The spot contract is down more than 10 percent for the quarter, its first weak quarter in a year. The contract extended losses after falling below the 200-day moving average last week at $2,368, attracting chart-based selling and long liquidation by speculators who are holding a large net long position. Liffe May cocoa inched down 3 pounds, or 0.2 percent, to settle at 1,445 pounds, a tonne after hitting 1,441 pounds, the lowest level for the second month since June 1. It closed lower for the eighth straight session after falling below the 200-day moving average at 1,541 pounds on Dec. 17.
Put selling in the options market was also seen weighing on futures, with significant open interest seen at 1,450 pounds. Valid cocoa stocks in NYSE Liffe's nominated warehouses rose to 51,070 tonnes as of Dec. 24, from 48,330 tonnes on Dec. 10, exchange data showed.
Arabica coffee futures on ICE changed direction and moved slightly lower, as the market continued to consolidate after falling earlier this month to the lowest levels in more than two years at $1.4220 per lb, basis the second position. March arabica coffee futures on ICE dropped 1.05 cent, or 0.7 percent, to settle at $1.4685 per lb. The spot contract has fallen more than 35 percent in 2012, its weakest annual performance in 12 years and by far the weakest commodity on the CRB, a global benchmark for commodities. March robusta coffee futures settled down $9, or 0.5 percent, at $1,911 a tonne. Certified coffee stocks held in NYSE Liffe nominated warehouses rose to 106,540 tonnes as of Dec. 24, up from 105,140 tonnes on Dec. 10, exchange data showed.