LONDON: Cocoa futures were lower on Wednesday, weighed down partly by the weakness of New York's December contract ahead of Thursday's first notice day, while sugar prices also slipped with the focus on the expiry of the December whites contract.
COCOA
March New York cocoa was off $20, or 0.9 percent, at $2,135 a tonne at 1214 GMT, extending its retreat from last week's 10-month high of $2,226.
Dealers said the weakness of December ahead of its first notice day on Thursday contributed to the decline. The front month slumped to a discount of around $40 to March after trading at a premium of more than $30 at one stage last week.
"New York has taken a big hit on Dec/Mar as they finalise positions ahead of first notice day tomorrow and it doesn't help the overall confidence in the market when the structure is falling out of bed," one dealer said.
Dealers said rains in top grower Ivory Coast could lead to disease pressures for the main crop but may also improve prospects for the mid-crop later in the season.
March London cocoa was off 20 pounds, or 1.2 percent, at 1,613 pounds a tonne.
Olam reported a 17.5 percent rise in third-quarter net profit but added its cocoa business "continued to experience headwinds with margin pressure for both the cocoa bean and products trading business, even as its processing business performed well."
SUGAR
March white sugar fell by $3.60, or 0.9 percent, to $389.20 a tonne.
Dealers said the main focus on Wednesday was the expiry of the December contract.
A small delivery is anticipated with an open interest of just 1,843 lots (92,150 tonnes) and further liquidation of positions taking place on Wednesday.
"That would normally make it something of a non-event but there is still a fair amount of speculation (and differing opinions) as to the origin of the sugar which will be delivered," said James Liddiard of consultancy Agrilion in a market note.
Possible sources for tenderable sugar include Brazil, Central America, the European Union and Ukraine.
March raw sugar was off 0.11 cents, or 0.7 percent, at 14.99 cents per lb.
COFFEE
March arabica coffee fell by 0.45 cents, or 0.3 percent, to $1.30 per lb.
January robusta coffee rose $6, or 0.3 percent, at $1,842 a tonne.
Comments
Comments are closed for this article.