LONDON: Cocoa futures on Liffe were lower on Monday as rains improved the outlook for crops in West Africa while robusta coffee also dipped in thin conditions with US markets shut for the Labor Day holiday.
Heavier rains in Ivory Coast's main cocoa regions last week bode well for the forthcoming main crop, farmers said on Monday, though they cautioned the harvest could be delayed by at least a month after weeks of dry weather.
Dealers said the rains had prompted speculators to trim a net long position.
Liffe December cocoa ended 15 pounds or 0.9 percent lower at 1,619 pounds a tonne, extending Friday's losses as it retreated from an 11-month high of 1,673 pounds hit on Aug. 20.
Dealers noted a large volume of futures and options traded in London on Friday, including call options with a strike price of 1,750 pounds.
"There are some people out there with very bullish views on the market. The (call) strike was quite high," a European trader said.
Robusta coffee futures on Liffe were also lower with bearish fundamentals keeping the market on the defensive.
"With the Brazilian arabica harvest peaking, Colombian output recovering, and the Vietnamese robusta crop to be harvested soon, supply is an important bearish factor for coffee," said F.O. Licht analyst Birgit Wippler.
November robusta coffee finished $21 or 1.2 percent lower at $1,758 a tonne.
White sugar futures on Liffe were barely changed with front month October closing a marginal $0.10 lower at $477.80 per tonne.
The global raw sugar market has been trading near three-year lows, pressured by a huge global surplus. ICE front-month raw sugar hit a three-year low of 15.93 cents a lb on July 16.
Sugar producers in South America and Asia are bolstering their dollar-denominated exports to take advantage of falling emerging market currencies yet the move risks weighing on already low global sugar prices.
"The weakness in the sugar export currencies of rupee, baht and real may continue to undermine any recovery in sugar prices," Nick Penney, senior trader with broker Sucden Financial Sugar, said.
Syria cancelled an urgent tender to buy sugar on Monday, two weeks after cancelling a bid to buy wheat, the latest signs that President Bashar al-Assad's government is losing its ability to buy food as civil war destroys its harvests.
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