NEW YORK/LONDON: Arabica coffee futures on ICE fell to a 5-1/2-month low on Monday, dropping for the sixth straight session on weakening charts and expectations for abundant supplies in the next season.
Raw sugar prices dropped for the fifth straight session to reach a seven-week low as traders focused on a global surplus, while cocoa prices rebounded from last week's multi-month lows.
COFFEE
March arabica coffee settled down 2.6 cents, or 2.1 percent, at $1.20 per lb after falling to $1.1955, the lowest on a continuation chart since June 23.
The drop took it to around 30 on the 14-day relative strength index, hovering around a technically oversold level.
"These fundamentals of global production surplus are the backdrop to the downwards movement in coffee prices," analysts CoffeeNetwork said in a report.
January robusta coffee settled down $22, or 1.3 percent, at $1,728 per tonne.
SUGAR
March raw sugar settled down 0.1 cent, or 0.7 percent, at 13.95 cents per lb, after falling to the lowest for the spot contract since Oct. 24 at 13.9 cents.
Focus had shifted from production concerns in top grower Brazil to higher output expected from other major growers including India and the European Union, traders said.
The market shrugged off data from Brazil that showed center-south mills sharply reduced sugar output late in November, cane industry group Unica said.
March white sugar settled down $1.30, or 0.4 percent, at $365.50 per tonne.
COCOA
March London cocoa settled up 20 pounds, or 1.4 percent, at 1,429 pounds per tonne, which was up from Friday's 7-1/2-month low at 1,377 pounds.
The discount of London December, which will expire on Tuesday, widened sharply to $100 under March, from $73 on Friday, as traders noted concern that relatively old cocoa may be tendered.
March New York cocoa settled up $25, or 1.3 percent, at $1,912 per tonne.
"Today's bounce is from the (London) Commitment of Traders report. Everyone started buying New York because they knew London would be higher," said Nick Gentile, managing partner of commodity trading advisor NickJen Capital, adding that this spurred short covering.
Reports late on Friday showed speculators nearly doubled their net short position on the London cocoa market and shifted to a small net short position in New York futures and options.
London-based hedge fund group Armajaro Asset Management said it is closing its coffee and cocoa hedge fund.
Comments
Comments are closed for this article.