NEW YORK/LONDON: White sugar futures on ICE extended losses to a three-week low on Wednesday as souring chart signals and worries about Indian exports inspired follow-through selling, while arabica coffee also touched a three-week low before closing higher.
SUGAR
December white sugar settled down $3.10, or 0.9 percent, at $355.70 a tonne after falling to $351.80, its weakest since Oct. 10. It closed October nearly 11 percent higher.
Dealers said prices continued to correct from a recent Brazilian real-inspired rally, with further speculative selling emerging after the market failed to push above technical resistance levels.
Focus shifted back to worries that India may export up to 5 million tonnes of sugar to the world market.
Market participants noted mills are likely to export sooner rather than later in a bid to capture the subsidies on offer.
"The current system is generous ... and could be repealed," Marex Spectron said in a note. "Additionally, if India does not step in to export quickly, potential markets will be lost."
March raw sugar settled down 0.13 cent, or 1 percent, at 13.19 cents per lb after sliding to 13.14, its lowest since Oct. 15. But it closed the month more than 26 percent higher.
Speculative buying waned as the real retreated following the Sunday election of Jair Bolsonaro as president.
A weaker real undermines prices because it encourages producer hedging by boosting local currency returns on dollar-traded goods like sugar and coffee.
"The sell-off in sugar will continue as supplies of sugar will continue to overwhelm demand and the strength of the real will become a distant memory in the coming weeks or months," said James Cordier, president of Option Sellers.
COCOA
December London cocoa settled down 8 pounds, or 0.5 percent, at 1,695 pounds a tonne, ending October more than 13 percent higher.
Prices were pressured by a stronger British pound.
December New York cocoa settled up $19 or 0.9 percent, at $2,234 a tonne, closing October 8.8 percent higher.
Ivory Coast is on track for a record cocoa harvest in the 2018/19 season.
COFFEE
December arabica coffee settled up 0.3 cent, or 0.3 percent, at $1.127 per lb after also touching a three-week low of $1.1135. It ended October more than 10 percent higher.
Focus remained on speculative activity and the Brazilian currency.
January robusta coffee settled down $1, or 0.1 percent, at $1,675 per tonne after sliding to a nearly four-week low of $1,661. It closed October 8.7 percent higher.
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