LONDON: Raw sugar futures on ICE edged up on Tuesday after plumbing a one-year low in the prior session, as speculators resisted taking on new short positions despite downbeat sentiment in wider financial markets.
Coffee prices also fell, while cocoa gained.
SUGAR
October raw sugar rose 0.5% to 17.67 cents per lb by 1525 GMT after hitting a fresh one-year low of 17.20 on Monday. The contract lost 6.9% in July.
Dealers said speculators are likely 50,000-60,000 lots net short and while they could sell a bit more, they have overall been reluctant to build large short positions over the past few years.
Their net shorts peaked at 78,000 lots in April 2020 when the COVID-19 pandemic hit, they noted.
Vietnam imposed an anti-dumping levy of 47.64% on some sugar products imported from five Southeast Asian countries but originating from Thailand for a period of four years, the country’s trade ministry said.
Thailand is the world’s third-largest sugar exporter.
October white sugar fell 0.1% to $523.70 a tonne.
COFFEE
September arabica coffee fell 1.6% to $2.0975 per lb??. The contract lost 7% in July.
Dealers said arabica is under pressure partly because index funds, which are passive net long investors, are rolling their positions from September to December futures.
This involves selling September and buying December futures - weakening the premium for September over December coffee and sending a signal to the wider market that nearby supply tightness is easing.
The funds should be finished rolling by Wednesday, however, dealers noted, adding they expect the premium will tighten again after that.
September robusta coffee fell 0.2% to $2,028 a tonne.
COCOA
September New York cocoa rose 0.4% to $2,400 a tonne.
Below-average rains last week in most of Ivory Coast’s cocoa regions were not hindering the development of the next October-to-March main crop, as the soil moisture content was high from previous rainfall, farmers said.
September London cocoa rose 1.3% to 1,733 pounds per tonne.
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