LONDON: Arabica coffee futures on ICE fell on Thursday, weighed down by currency pressures and producer hedging, while New York cocoa rose and raw sugar eased.
COFFEE
March arabica coffee was down 1.20 cents, or 1 percent, at $1.2210 per lb by 1215 GMT, after slipping to a session low of $1.2175.
Dealers said a recent speculative rally in the market had brought out fresh selling by Brazilian producers, who remain significantly under-hedged.
Prices were also weighed down by a weakening in the Brazilian real, which improves local currency returns on dollar-traded commodities like coffee and encourages more selling.
"The Brazilians have been a seller, with the real slipping back," said one dealer.
March robusta coffee was down $3 or 0.2 percent at $1,783 a tonne.
Dealers said funds rolling short-positions forward was supporting the spread, with the March contract moving to its largest premium over the May position since February 2017.
"That's the big technical funds rolling forward, so that inversion has helped keep robusta prices generally steady," the dealer said.
However, dealers pointed to pressure from Vietnamese producer selling, although hedging was expected to slow during the upcoming Tet holiday.
"They've still got a lot to do," the dealer said, estimating Vietnamese farmers sold forward up to 30 percent of their crop. "It's a healthy crop and they've done a lot - but it doesn't mean they haven't got more to do."
Vietnam, the world's top robusta producer, is expected to export 120,000 to 130,000 tonnes (2.0 million-2.2 million 60-kg bags) of coffee in February, traders said on Thursday.
COCOA
March New York cocoa rose $23 or 1.1 percent to $2,060 a tonne, recovering some of the prior session's losses.
Prices climbed on Wednesday but sharply reversed course after the US dollar surged higher.
Dealers pointed to speculative short-covering in light volume and a more muted dollar as key supportive factors on Thursday.
The mood in the market has also recently improved on signs that port arrivals in top grower Ivory Coast could be slowing down.
May London cocoa was up eight pounds or 0.6 percent at 1,470 pounds a tonne, with gains in that market muted by a stronger British pound.
SUGAR
March raw sugar was down 0.04 cent, or 0.3 percent, at 13.96 cents per lb.
March white sugar fell $0.40, or 0.1 percent, to $360.60 per tonne.
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