ICE raw sugar futures fell on Thursday, weighed by the stronger US dollar and as investors once again fretted about the stalling global economic recovery. Arabica coffee futures on ICE were also lower, consolidating gains from Wednesday's short-covering rally, and cocoa prices eased as ample supplies weighed. The Reuters-Jefferies CRB, a global benchmark for commodities, fell more than 2 percent.
That put it on track for its largest daily decline since August 8, when energy, metals and agricultural markets slumped following the Standard & Poor's downgrade of the US triple-A credit rating. Renewed unease about a sluggish economic recovery prompted investors to cut exposure to riskier assets. Sugar investors are torn between downward revisions in sugar production in top exporter Brazil, due to a combination of weather factors and aging cane, and expectations for big northern hemisphere crops in the fourth quarter.
"Everything has stabilised after getting blasted (in Europe)," said The Price Group senior analyst Jack Scoville. October raw sugar on ICE was down 0.36 cent or 1.2 percent at 29.13 cents a lb at 12:21 pm EDT (1621 GMT), after falling to 28.64 cents. October white sugar on Liffe eased $2.80, or 0.4 percent, to $768.40 per tonne. Arabica and robusta coffee futures were lower, giving back gains after a partly technically driven short covering rally on Wednesday.
December arabica coffee on ICE fell 2.55 cents, or 2.5 percent, to $2.6430 per lb. December arabica remained well above the 200-day moving average around $2.5160 for the third straight day but felt strong resistance at the 100-day moving average around $2.69. November robusta coffee on Liffe tumbled $88, or 3.7 percent, at $2,292 per tonne. December cocoa on ICE dropped $54, or 1.8 percent, to close at $2,985 a tonne, while Liffe December cocoa fell 21 pounds to finish at 1,888 pounds a tonne.
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