Raw sugar futures on ICE extended gains to reach the highest in more than five weeks on Tuesday, with the market underpinned by news that No. 2 grower India could build up government stockpiles of the sweetener in a move that could curb exports. July raw sugar settled up 0.05 cent, or 0.4 percent, at 12.15 cents per lb, after rising to 12.29 cents, the highest since April 13.
Total open interest rose to the highest since February 2008 at 1,036,966 lots on Monday, when the spot contract rallied 3.8 percent, its biggest one-day jump in 2018, ICE data show. Prices extended the prior session's gains on support from news in India, where the government will build stockpiles of sugar to cut a surplus in the market, two official sources said on Tuesday.
"This should also reduce the volume of Indian sugar that we could see exported onto the world market. We had been expecting India to export up to 3 million tonnes over the 2017-18 season," ING said in a market note. August white sugar settled up $3, or 0.9 percent, at $343 per tonne. July New York cocoa settled down $26, or 1 percent, at $2,589 per tonne, after falling to a five-week low at $2,575.
The recent decline has been driven by funds scaling back long positions against the backdrop of favourable weather in Ivory Coast, improving the outlook for the 2017-18 mid-crop in the world's top grower. July London cocoa settled down 6 pounds, or 0.3 percent, at 1,857 pounds per tonne. Ivory Coast cocoa grinders processed 2 percent more beans in the first seven months of the 2017-18 crop year than the same period a year ago, data from exporters' association GEPEX showed.
Meanwhile, Barry Callebaut plans to boost the annual grinding capacity of its facilities in Ivory Coast, CEO Antoine de Saint-Affrique said on state-owned broadcaster RTI. July arabica coffee settled up 0.65 cent, or 0.5 percent, at $1.2085 per lb. Arabica futures were supported by the firm Brazilian real versus the US dollar, traders said. Reports of light frost in isolated parts of Brazil, where dry conditions have weakened trees in some areas, spurred some short-covering, traders said. July robusta coffee settled down $5, or 0.3 percent, at $1,790 per tonne. Swiss commodities trader Sucafina picked up a large chunk of robusta coffee stocks tendered, sources told Reuters.