LONDON: London cocoa futures turned lower on Monday after touching a three-month high, pressured by a stronger pound, while raw sugar futures edged higher.
COCOA
May London cocoa was down 6 pounds, or 0.4 percent, at 1,541 pounds a tonne by 1039 GMT, retreating from an earlier three-month peak of 1,554 pounds.
Sterling rose on Monday after comments from the once-dovish Bank of England deputy governor reinforced the view that the bank would soon raise interest rates, while the opposition Labour party's support for a customs union after Brexit added to the optimism.
The market's run-up has been fuelled by fund short-covering and some concern that hot, dry weather could curb production in Ivory Coast.
May New York cocoa rose $9, or 0.4 percent, to $2,203 a tonne after equalling Friday's three-month high of $2,205.
"Momentum is clearly in favour of the upside and we expect this to continue in the near term," said Sucden Financial technical analyst Geordie Wilkes.
Indonesia will raise its export tax for cocoa to 5 percent in March, the trade ministry said on Monday. The cocoa export tax is to be increased after being kept at zero for two months.
SUGAR
May raw sugar was up 0.08 cents, or 0.6 percent, at 13.54 cents per lb.
Dealers noted March's premium to May had been rising steadily in the past few days, with the former contract's expiry on Wednesday.
The front month's spread could indicate some short-term supply tightness, though overall supplies remain ample with a large global surplus widely forecast for the current 2017/18 season.
"The global surplus keeps getting bigger," Marex said in a market update.
"Estimates of India's current crop are now knocking on 29 million tonnes and expectations are for an even bigger crop next year, making India virtually certain to export substantially at some stage in the not-too-distant future."
May white sugar rose $1.50, or 0.4 percent, to $363.40 a tonne.
COFFEE
May arabica coffee rose 0.7 cents, or 0.6 percent, to $1.2170 per lb, boosted by a softer dollar.
May robusta coffee was down $5, or 0.3 percent, at $1,746 a tonne.
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