NEW YORK/LONDON: ICE coffee futures fell on Monday, with arabica prices pressured by abundant supplies and chart-based weakness, while robusta traders began another round of hedging at the start of a new season in top producer Vietnam.
Raw sugar prices fell for the third straight session, extending losses below last week's highest level in more than four years on technical weakness.
Cocoa rose along with the 19-market Thomson Reuters CoreCommodity Index. December arabica coffee settled down 4 cents, or 2.6 percent, at $1.4755 per lb. November robusta coffee settled down $27, or 1.4 percent, at $1,977 per tonne.
"I think we're just starting to see the new Vietnam crop begin to be hedged as pressure hits the market," said a European dealer.
"As we move closer to the first shipments arriving in December, January onwards you'll see more and more of this coffee begin to get hedged." Vietnam's 2016/2017 season began this week, with the harvest to start in late October and peak in December, about two weeks later than usual.
The Vietnam Coffee and Cocoa Association has forecast 2016/2017 output to drop 20 percent to 25 percent due to drought. Raw sugar futures fell, with the March contract closing down 0.33 cent, or 1.4 percent, at 22.67 cents per lb. The weak session came after the October contract expired on Friday, with a moderate delivery of 772,958 tonnes, exchange data showed.
"The market got ahead of itself. The fact that it failed at 24 cents is (technically) negative," said Michael McDougall, director of commodities for Societe Generale in New York.
"I imagine the funds are a little bit nervous about seeing their profits erode the last quarter."
Data late Friday showed that speculators raised their net long position in raw sugar contracts to a record high for the second straight week, and dealers attributed the weak session to fund profit-taking.
December whites settled down $8.90, or 1.5 percent, at $588.30 per tonne, retreating from a four-year peak of $619 last week.
London cocoa futures rose on the weak sterling, which slid toward a three-decade low against the dollar after British Prime Minister Theresa May set a March deadline for the formal departure process from the European Union to begin.
March London cocoa settled up 30 pounds, or 1.4 percent, at 2,194 pounds per tonne. New York December cocoa following the London market higher to close up $32, or 1.2 percent, at $2,793 per tonne.
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