LONDON: Raw sugar futures on ICE steadied on Wednesday after falling sharply during the previous session following the suspension of a fuel tax increase in Brazil.
SUGAR
October raw sugar was up 0.02 cent, or 0.14 percent, at 13.92 cents per lb at 1350 GMT after dipping to 13.73 cents, the weakest price for the front month since July 13.
Dealers said the market was consolidating after falling sharply on Tuesday on news that a large fuel tax increase in Brazil, announced by the government last week to reduce a budget deficit, had been suspended.
Prices rose to a seven-week high last week after the tax changes were announced, as they would potentially have led to more cane being used to produce ethanol rather than sugar.
But a Brazilian federal judge suspended the tax increase on Tuesday, according to a court ruling seen by Reuters.
Sucden Financial co-ahead of softs Tom Kujawa said the market was awaiting an update on the legal proceedings in Brazil and the extent of damage to Brazil's cane crop from a recent cold snap.
"Otherwise we seem likely to trade 25 points or so either side of 14 cents," he said in a market note.
October white sugar was up $0.10, or 0.03 percent, at $382.10 a tonne.
COFFEE
September robusta coffee rose $34, or 1.62 percent, to $2,134 per tonne.
Dealers said the market was supported by technically driven buying after breaking above the 10-day moving average.
September arabica coffee rose 2.05 cents, or 1.57 percent, to $1.3265 per lb with the market showing signs of resuming its recent uptrend, underpinned partly by the slow pace of exports from top producer Brazil.
COCOA
December New York cocoa was down $7, or 0.36 percent, at $1,956 a tonne after touching a one-week low of $1,937.
Dealers said the market's recent rally appeared to have run out of steam amid sluggish demand and a large global surplus in the current 2016-17 season.
They noted adverse crop weather in top grower Ivory Coast should curb production next season, although overall supplies were likely to remain ample.
December London cocoa fell 5 pounds, or 0.33 percent, to 1,533 pounds a tonne.
Comments
Comments are closed for this article.