Soft commodities markets on ICE Futures US advanced on Tuesday in thin trade as traders covered short positions ahead of the year-end. Cocoa, coffee and sugar markets opened late after being closed on Monday for the Christmas holiday. London trading remained closed for UK Boxing Day. Weakness in the US dollar index buoyed greenback-traded commodities, making them less expensive to holders of other currencies.
COFFEE
The most-active ICE March arabica coffee futures rose 1.05 cent, or 0.87 percent, at $1.2145 per lb by 9:40 am EST (1440 GMT).
"We're seeing some short-covering... the speculators are taking some profits," said a trader in New York.
Weekly government data published after the close on Friday showed speculators had built up their bearish positions in coffee, cocoa and sugar, prompting some sellers to cover their positions.
Speculators increased a record net short position in arabica coffee contracts on ICE Futures US in the week to December 19, and also raised bearish stances in cocoa and sugar, US Commodity Futures Trading Commission data showed on Friday.
China's imports of coffee were down last month and down year-to-date, data showed on Tuesday.
COCOA
Cocoa futures also gained amid short-covering, rising off Friday's low of $1,804, the weakest for the most-active contract since July.
The most-active New York cocoa contract for March delivery rose $25.00, or 1.38 percent, to $1,834.00 per tonne.
Cocoa arrivals at ports in top grower Ivory Coast had reached about 751,000 tonnes by December 24th since the start of the season on October 1, exporters estimated on Tuesday, down from 833,000 tonnes in the same period last season.
China's imports of cocoa beans were down in November, but shipments of chocolate products rose.
SUGAR
ICE March raw sugar edged up 0.02 cent, or 0.14 percent, to 14.62 cents per lb.
Traders expect sugar prices to remain depressed in the new year as supplies swell in the European Union and Asia. But prices may see early support from index fund rebalancing after 2017's price rout, traders said. "Sugar is the commodity where the index fund reweighting will be significant," said the US trader, noting funds are expected to buy more than 60,000 contracts of the sweetener.