LONDON: Raw sugar futures on ICE slid to a more than two-week low on Monday, weakened partly by improving crop outlooks in several key producing countries, while arabica coffee prices also fell.
July raw sugar fell by 0.58 cents, or 3.3%, to 16.96 cents per lb by 1348 GMT after slipping to 16.93 cents, the weakest level since May 27.
Dealers said supplies appeared ample, boosted by the strong pace of production in Centre-South Brazil, while the prospects for 2021/22 season crops in key Asian producers India and Thailand were favourable.
Commodity trader and supply chain services company Czarnikow on Monday forecast a global surplus of 1.5 million tonnes in 2021/22 and 2.7 million tonnes in the current 2020/21 season, driven by rising production.
Rains in India have helped to improve the production outlook.
“Cane growing conditions remain promising (in India) with plenty of rain. It was India’s second-wettest May in over 100 years and the monsoon rains have arrived on time,” Czarnikow said, adding that Indian production should exceed 30 million tonnes in 2021/22 for the second consecutive season.
Speculators have also been scaling back net long positions in both raw sugar and arabica coffee.
August white sugar fell by $10.30, or 2.3%, to $441 a tonne.
September arabica coffee fell by 4.25 cents, or 2.7%, to $1.5535 per lb.
Dealers noted there had been some rain in Brazilian coffee areas and more was forecast during the next few days, though dry conditions in the world’s top producer remained a concern.
September robusta coffee fell by $31, or 1.9%, to $1,588 a tonne.
September London cocoa rose by 4 pounds, or 0.25%, to 1,626 pounds a tonne.
Above-average rainfall was recorded in Ivory Coast’s cocoa regions last week, raising expectations for a strong finish of the April-to-September mid-crop cocoa harvest, farmers said on Monday.
September New York cocoa rose by $13, or 0.5%, to $2,415 a tonne.
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