LONDON: Arabica coffee futures on ICE dipped on Wednesday after hitting a three week high earlier in the session as overall weakness in the dollar this week discouraged producer selling.
COFFEE
September arabica coffee was down 0.5 cents, or 0.4pc, at $1.0700 per lb at 1515 GMT, after rising to a peak of $1.0820, its highest since early June.
The contract surged 4.3pc on Tuesday and has closed higher in four of the past five sessions.
"The market is adjusting to a weaker dollar and stronger real. (Brazilian) farmers are receiving less (for their coffee) and so are reluctant to sell, its nothing fundamental," said Ricardo Santos, managing director of Riccoffee.
The dollar recovered some ground on Wednesday but remained on the defensive, having hit a three-month low against a currency basket on Tuesday amid expectations of aggressive interest rate cuts from the US Federal Reserve.
September robusta coffee fell $11, or 0.8pc, to $1,444 a tonne.
SUGAR
July raw sugar fell 0.16 cents, or 1.3pc, to 12.17 cents per lb.
The market is focused on the expiry of the July contract later this week, with the potential for significant tonnages to be tendered.
"It seems two of our major global sugar trade houses are facing off in what looks a possible record delivery.
There is potential for some quite 'choppy action' on the (front-to-second month spread) during the final run in," said Thomas Kujawa, co-head of softs at Sucden Financial.
In industry news, sugar production in Brazil's main producing region in the first half of June remained below levels seen at this time in the previous season, cane industry group Unica said.
August white sugar fell $3.50, or 1.1pc, to $320.60 per tonne.
COCOA
September New York cocoa fell $5, or 0.2pc, to $2,459 per tonne.
Dealers are keeping a close watch on the weather in top producer Ivory Coast, where dryness is a concern.
Unseasonably dry weather across Ivory Coast's cocoa regions last week could weaken the next main crop if rainfall does not increase in July, farmers said on Monday.
September London cocoa rose 8 pounds, or 0.4pc, to 1,828 pounds a tonne.
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