LONDON: Raw sugar prices on ICE climbed on Wednesday after earlier hitting an 11-month low, supported by higher energy prices and a firmer Brazilian currency, while arabica coffee prices also rose.
October raw sugar settled up 0.13 cent, or 1.2pc, at 11.37 cents per lb, after earlier falling to an October 2018 low of 11.09 cents per lb.
Prices were underpinned by higher energy prices, which can encourage cane mills to produce more biofuel ethanol, dealers said.
Also supportive was a stronger Brazilian real, which on Tuesday had tumbled to its weakest levels in nearly a year. A stronger real discourages producer selling of dollar-denominated commodities.
India will provide a subsidy of 10,448 rupees ($146.14) per tonne for sugar exports to encourage cash-strapped mills to increase shipments to 6 million tonnes.
This was a lower subsidy than some had expected, with some millers and officials indicating that it may not drastically increase exports.
India’s subsidy comes despite complaints to the World Trade Organization from rival producers Brazil and Australia.
October white sugar settled up $3.10, or 1pc, at $309.20 per tonne.
December arabica settled up 0.4 cent, or 0.4pc, at 97.55 cents per lb.
The market continues to struggle to absorb top grower Brazil’s record-large crop from the current and last seasons.
Losses have been limited of late, however, by signals that bad weather in Brazil may curtail production there.
November robusta coffee settled up $12, or 0.9pc, at $1,351 per tonne, after climbing to a nearly one-month high of $1,368 amid dwindling end-of-season stockpiles in top robusta producer Vietnam.
December New York cocoa settled down $4, or 0.2pc, at $2,243 per tonne, having hit a two-week peak on Monday in a technical move off the five-month lows hit earlier this month.
Weather prospects in West Africa continue to improve, however. Above-average rain last week was expected to boost the start of Ivory Coast’s October-to-March main crop.
December London cocoa was unchanged from the previous session, settling at 1,716 pounds a tonne.
Losses were limited by a slide in the pound, which makes sterling-priced London cocoa cheaper for holders of other currencies.