LONDON: Raw sugar futures on ICE fell on Wednesday, with rains in Brazil potentially improving the outlook for cane crops, while cocoa and coffee prices also retreated.
March raw sugar was down 1.4% at 22.98 cents per lb by 1139 GMT. Dealers said forecast showers in Centre-South Brazil this week could ease concerns about dry conditions, though doubts remain over whether there will be sufficient rain to make a significant difference.
Analyst Green Pool downgraded its forecast for the 2024/25 cane crop in CS Brazil late last week, saying that some yield potential had already been lost.
The weather in Brazil has become a key focus partly because poor crops in some other countries had increased the global market’s dependence on the world’s biggest producer.
“Drought conditions in Southeast Asia have affected sugar production in major markets, notably in India, where sugar mill output has fallen by 7%.
This decrease has reignited market concerns over the possibility of India extending its export restrictions,” BMI said in a note. March white sugar fell 0.8% to $653 a metric ton.
May London cocoa was down 0.7% at 4,671 pounds a ton.
Dealers said the market was consolidating after its recent run to record highs, but prices remain underpinned by supply tightness after poor crops in the world’s top two producers, Ivory Coast and Ghana. May New York cocoa fell 0.8% to $5,606 a ton. The makers of Hershey and Cadbury chocolate are planning more price increases to cover another record-setting surge in cocoa prices, even as inflation-hit consumers curb purchases and company profits face a hit. May arabica coffee fell 2.5% to $1.8335 per lb. Dealers said rains in Brazil this week could improve the crop outlook for the world’s top producer. May robusta coffee fell 1.8% to $3,105 a ton.
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