LONDON: Robusta coffee futures fell on Wednesday as Brazil seemed to backtrack away from plans to allow imports for the first time, while raw sugar eased after hitting technical resistance.
COFFEE
Robusta coffee futures slipped, with the May contract down $29, or 1.32 percent, at $2,160 a tonne by 1237 GMT, after slumping to a session low of $2,141.
The market weakness came as Brazil's President Michel Temer ordered a suspension of the authorisation of robusta coffee imports.
The country was set to allow imports of 1 million 60-kg bags of coffee from Vietnam at a 2 percent tariff for the first time under a decree outlined this week.
"For me, for anything like this to go through, it's got to be a desperate situation," one dealer said, noting a recent fall in internal prices suggested this was not that case. "It shows you there's coffee there. They just need a bit of pressure to sell it."
The imports were meant to ease a supply squeeze that has hit the country's soluble industry, reportedly forcing them to turn down offers from foreign buyers.
However, local robusta producers have opposed the move, maintaining there is enough domestic supply to meet demand.
The uncertainty has triggered a pull-back by speculators, who have recently started reducing record net long positions built on expectations of imports.
May arabica was down 0.10 cents, or 0.07 percent, at $1.5175 per lb.
SUGAR
March raw sugar futures eased 0.02 cents, or 0.10 percent, to 20.72 cents per lb, after surging higher in the previous session.
The contract gained 2.4 percent, supported by a tightening of nearby supplies highlighted by buying from Iran and Egypt.
However, prices stalled on Wednesday as they struggled to breach a key resistance level, while an ample supply outlook weighed further.
The International Sugar Organization on Tuesday scaled back its global sugar deficit forecast for the 2016-17 season to 5.869 million tonnes, from a previous estimate of 6.19 million tonnes.
May white sugar was down $0.40, or 0.07 percent, at $560.20 a tonne.
COCOA
May New York cocoa was up $1, or 0.05 percent, at$1,997 a tonne.
May London cocoa rose 2 pounds, or 0.12 percent, to 1,616 pounds a tonne.
Comments
Comments are closed for this article.