Arabica coffee falls as focus returns to excess supply

LONDON: Arabica coffee futures on ICE fell on Thursday, reversing the previous session's bounce off three-month lows, as the market's focus returned to the issue of excess supply.

COFFEE

* December arabica coffee was down 0.45 cent, or 0.5%, at 96.20 cents per lb at 1123 GMT.

* The benchmark second position dipped to a three-month low of 93.40 cents on Tuesday.

* A stronger Brazilian real, which discourages producer selling, and expectations of a smaller Brazilian coffee crop next year had supported prices on Tuesday, but gains have proved short-lived.

* "Roasters are happy to wait for lower prices (before they) start buying, (while) every time there's a (price) bounce its seen by origin as an opportunity to sell," said a dealer.

* November robusta coffee was up $6, or 0.45%, at $1,330 a tonne.

* Coffee prices in top robusta producer Vietnam were unchanged this week amid few trades and dwindling end-of-season stockpiles, while Indonesian prices fell as more supply came on stream despite the harvest-end looming.

SUGAR

* October raw sugar was flat at 11.37 cents per lb.

* Prices have been rangebound in recent sessions, caught between signals of excess near-term supply and forecasts that longer-term, the market will swing into deficit.

* Prices are also drifting as the market awaits a decision by India, a top sugar producer, on the terms under which it will extend its export subsidy system until September 2020.

* "In the short term prices still look vulnerable to returning to the lows seen a couple of weeks ago but the down side should be limited," said a dealer.

* Monsoon rains in India in the week through to Wednesday were above average for a fourth straight week, the weather office said.

* Also, Russia cut its white sugar exports sharply in the 12 months to July 30, but may lift them significantly in the new season due to weak domestic prices.

* October white sugar rose $0.20, or 0.2%, to $308.40 a tonne.

COCOA

* December New York cocoa was up $13, or 0.6%, at $2,220 a tonne.

* The benchmark second position dipped to a five-month low of $2,165 a tonne on Tuesday.

* The market had become technically oversold following a prolonged slide in prices but the scope for further gains may be capped by favourable crop weather in West Africa which has improved the outlook for 2019/20 main crops.

* December London cocoa rose 6 pounds, or 0.4%, to 1,729 pounds a tonne.