LONDON: Raw sugar futures on ICE fell on Friday, retreating from an eight-month peak as fund short-covering slowed, while cocoa prices rose on signs of upbeat demand in North America and Asia.
SUGAR
March raw sugar was down 0.07 cents, or 0.5 percent, at 13.80 cents per lb by 1022 GMT, pulling away from the previous session's eight-month high of 13.95 cents.
The market has rallied sharply in recent weeks, boosted by short-covering linked to a stronger currency in top grower Brazil.
However, dealers on Friday cited a pick-up in producer hedging, coupled with a slowdown in speculative buying inspired by technically overbought market conditions.
"Most think that prices have overshot the mark, ourselves included," Commonwealth Bank of Australia's Tobin Gorey said in a note.
The fundamentals focus remained on Brazil, where recent wet weather poses a further threat to the country's already diminished production, according to Marex Spectron.
"The latest forecast is for wet conditions to continue into November, which may have further negative implications for crop estimates," the commodity broker said.
December white sugar fell $1.70, or 0.5 percent, to $376.90 a tonne after setting a nine-month high on Thursday.
COCOA
December London cocoa rose 19 pounds, or 1.2 percent, to 1,600 pounds a tonne.
December New York cocoa climbed by $26, or 1.2 percent, to $2,171 a tonne, a day after slumping more than 3 percent on speculative long-liquidation.
Sentiment was boosted on Friday as data showed North American grindings rose 2.5 percent in the third quarter, surprising forecasters with the strongest quarterly figure since 2014.
Grindings in Asia rose 3.7 percent in the third quarter. The year-on-year increase was more modest than in recent quarters but still topped last year's unusually strong grindings, setting a fresh record for the third quarter.
"This quarter's numbers reflect the continuous strong demand for cocoa ingredients," the Cocoa Association of Asia (CAA) said. "This was another record Q3 number and, if the trend continues into Q4, then 2018 would be another record year for (the) CAA grind."
COFFEE
December arabica coffee fell by 0.1 cents, or 0.1 percent, to $1.2195 per lb.
Prices rose to their highest in 4-1/2 months in the previous session but hit technical resistance and closed lower.
January robusta coffee slipped by $12, or 0.7 percent, to $1,763 a tonne. It touched its highest in nearly five months on Thursday.
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