LONDON: Arabica coffee futures on ICE rose to 3-1/2 month high on Wednesday, extending their recent rebound from a 13-1/2 year low earlier in May, boosted by technically driven buying and a strengthening in Brazil's real currency.
COFFEE
July arabica coffee was 2.0 cents, or 2.1pc, higher at 98.05 cents per lb at 1403 GMT after peaking at 98.35 cents, the highest since Feb. 15.
Dealers said cold weather in top grower Brazil may have played a role in the recent run-up although there remained no immediate threat of crop damaging frosts.
"It was a relatively mild cold front, without any mentionable damage, that lifted the market by simply reminding players that the weather can be unpredictable," Rabobank said in a market note.
Brazil's real has also recovered some ground during the last few days, reducing returns in local currency terms for dollar-denominated commodities such as coffee and sugar and thereby discouraging producer selling.
July robusta coffee rose $18, or 1.3pc, to $1,390 a tonne.
Vietnam's coffee exports in the first five months of 2019 would likely fall 13.1pc from a year earlier to 767,000 tonnes, preliminary government data showed on Wednesday.
SUGAR
July raw sugar was up 0.18 cent, or 1.5pc, to 11.93 cents per lb, also supported by a firmer Brazilian real.
The market also derived some support from broad-based strength in agricultural commodity markets, including grains and coffee, but the upside remained capped by plentiful supplies.
"We do not yet have an investable story that could provoke a strong short covering rally like those seen in the grains charts," said Tom Kujawa, co-head of the softs department at Sucden Financial.
August white sugar was up $2.10, or 0.6pc, at $327.70 a tonne.
Brazilian sugar and ethanol producer Usina Santa Adélia will close one of its three mills in Sao Paulo state to cut costs and boost efficiency, the company said.
COCOA
July London cocoa rose 3 pounds, or 0.2pc, to 1,788 pounds a tonne.
July New York cocoa was up $2, or 0.1 percent, at $2,452 a tonne.
Ghana's cocoa regulator Cocobod will issue up to $2 bln in long-dated debt to fund road construction and refinance existing loans, its deputy chief executive for finance said on Tuesday.
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