LONDON: Raw sugar futures on ICE were lower on Friday with concerns about oversupply keeping the market on the defensive, while arabica coffee prices also eased.
SUGAR
July raw sugar was down 0.09 cents, or 0.8 percent, at 11.18 cents per lb by 1328 GMT.
Dealers said the strong early start to the harvest in Brazil had added to concerns about oversupply.
Brazil's centre-south, the world's largest sugar producing region, crushed almost 50 percent more cane in April, the first month of the 2018/19 local crop season, than it did a year earlier, as dry weather accelerated field work.
"It is more sugar (from Brazil) and with India looking to have record production next year it is not surprising the market is down," one dealer said.
Dealers said producers were slowly revising down the price at which they would be willing to sell.
"Any rally is going to be sold (by producers) which is keeping a cap on the market," the dealer added.
August white sugar fell $2.40, or 0.7 percent, to$321.00 a tonne.
Dealers noted significant interest in trading the whites premium which has climbed recently from $63 to as high as $75 on an August whites/July raws basis.
"I think people are playing a bit in there and it is creating some side interest while the flat prices are perennially under pressure," one dealer said.
The United States will produce nearly 9 million short tonnes of sugar in 2018/19, the lowest in two years, the US Department of Agriculture said in its first forecast for the crop year on Thursday.
COFFEE
July arabica coffee fell 0.20 cent, or 0.2 percent, to $1.1935 per lb.
Dealers said the market was keeping a close watch on Brazil's real currency with its rebound on Thursday helping the market recover ground after falling to a two-week low of $1.1835 per lb.
July robusta coffee rose $2, or 0.1 percent, to$1,745 a tonne.
Louis Dreyfus Company has offloaded the bulk of its certified robusta coffee stocks ahead of a rule change that will make it more expensive to carry the coffee forward, industry sources told Reuters.
COCOA
July New York cocoa was up $19, or 0.7 percent, at$2,781 a tonne as the market moved up towards the middle of this month's trading range.
July London cocoa fell 5 pounds, or 0.3 percent, to 1,926 pounds a tonne.
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