LONDON: Robusta coffee futures were lower on Wednesday as investors reduced long positions while trade and industry buying helped to limit losses.
January robusta coffee on ICE was off $35 or 1.7 percent at $2,064 a tonne at 1208 GMT as the market moved towards the lower end of its trading range. "I think the selling that has come in is a little bit of profit-taking. Specs are just lightening the load," one London dealer said, adding some were looking to lock in positive annual returns and would re-evaluate their strategy in the New Year.
Benchmark robusta futures have risen around 35 percent so far this year, boosted by tightening supplies following poor crops in Indonesia and Brazil and the prospect of lower production in Vietnam where the harvest is now underway.
Dealers said the market was trapped between solid support around $2,000 and resistance at $2,200, a range it has held since early October.
"London (robusta) is stuck in that $200 range at the moment. When it comes down you get industry and trade come in and buy it," one dealer said.
Arabica coffee futures were also lower with March down 1.45 cents or 0.9 percent at $1.6040 per lb.
Dealers said the arabica market was weighed partly by rains in Brazil which has boosted the outlook for next year's crop.
Raw sugar futures were slightly lower, drifting down towards the prior session's 2-1/2 month low.
Dealers said the market's recent weak performance had led to technically-driven selling by investment funds.
"The investor long, the overwhelming majority of which is momentum-based, has the autopilot set to sell," said analyst Tobin Gorey of Commonwealth Bank of Australia.
"In the light of that most buyers will think they can afford to be patient. Momentum investors' positions are of course finite so they will eventually clear the position - we think they still have more to do for now."
March raw sugar was off 0.06 cents, or 0.3 percent, at 19.69 cents a lb. The front month had dipped to a low of 19.65 cents on Tuesday, its weakest since Sept. 2.
March white sugar fell $2.20, or 0.4 percent, to $524.30 per tonne. Cocoa futures were also lower with an improving crop outlook in top grower Ivory Coast keeping the market on the defensive.
March New York cocoa was off $8, or 0.3 percent, at $2,432 a tonne. The second position fell to a low of $2,358 last week, its weakest since August 2013.
March London cocoa fell 5 pounds or 0.25 percent to 2,004 pounds a tonne.
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