LONDON: Raw sugar futures fell on Wednesday, slipping from a seven-month peak as fund selling and a weaker Brazilian currency offset fresh signs of lower output from the top grower, while arabica coffee turned lower after setting a 3-1/2 month high.
SUGAR
March raw sugar was down 0.20 cent or 1.5 percent at 12.78 cents per lb by 1420 GMT, after earlier touching 13.14 cents, the highest for the front month since early March.
A sharp decline in Brazil's real currency boosted selling. A weaker real encourages producer selling by increasing returns in local currency terms on dollar-traded commodities.
This offset earlier gains on the back of data showing Brazil's centre-south region produced 1.286 million tonnes of sugar in the second half of September, compared to 2.147 million tonnes in the previous two-week period.
This was lower than industry expectations, with an S&P Platts survey of analysts having forecast output at 1.364 million tonnes.
Cane group UNICA reported more mills had wrapped up for the season and centre-south production is likely to drop by 9 million tonnes due to higher ethanol output.
However, this was largely offset by worries about ample supplies from elsewhere, including a massive glut from India.
"It will be a stretch to get above 27 million tonnes for the (Brazil) crop due to likely early closure by the mills," Marex Spectron said in an update. "The question is how much of this has been priced by the market already."
December white sugar rose $0.40, or 0.1 percent, to $353.80 a tonne.
COFFEE
December arabica coffee fell 1.75 cents, or 1.55 percent, to $1.1140 per lb, after earlier rising to a high of $1.1420, its highest since June 27.
Dealers said the run-up has been driven by fund short covering, although producer selling was now emerging as the Brazilian real gave up its recent gains.
January robusta coffee fell $26 or 1.5 percent to$1,678 a tonne, after climbing to its highest since June 12 earlier.
Brazilian coffee exporters shipped 27 percent more coffee abroad than a year earlier as the country sells a record crop, but lack of container space prevented larger volumes.
COCOA
December London cocoa shed 30 pounds, or 1.9 percent, to 1,543 pounds a tonne, partly weighed down by a firmer British pound.
December New York cocoa fell $31, or 1.5 percent, to $2,088 a tonne.
Dealers said the market was again battered by speculative selling inspired by weakening chart signals.
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