Raw sugar futures tumbled Tuesday after China's decision to raise interest rates for the second time in over a month, spurring a commodity-wide selling spree in the volatile market. Coffee futures weakened as well, but cocoa futures ran up as market participants continued to fret over political turmoil in top grower Ivory Coast.
China's central bank raised its benchmark deposit rate, sending commodity prices lower as markets fretted the decision could slow domestic consumption in the world's No 2 economy. The key March raw sugar contract on ICE Futures US dropped 1.52 cents or by 4.65 percent to finish at 31.16 cents per lb, having plunged during the session as much as 5 percent to trade at a session low of 31.02 cents.
Arabica coffee also saw some position rolling out of March ahead of first notice day February 17, into May. The market moved up as tight supplies propped up prices, but hesitated below last week's 13-1/2-year high at $2.536, basis March. New York's March arabica coffee futures fell 2.15 cents to close at $2.476 per lb. The May cocoa contract in New York gained $21 to finish at $3,260 per tonne.
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