Liffe coffee lower

Liffe September robusta coffee ended off $36 at $2,216 a tonne on Thursday after hitting $2,205 earlier in the session, the lowest level for the benchmark second month in almost five months. Market weighed by steep losses in crude oil and other commodity markets.
Liffe September cocoa ended 7 pounds lower at 1,894 pounds a tonne. A fall in sterling to a near three-month low against the dollar helped to partially offset commodity-wide weakness. Liffe August white sugar closes $7.60 lower at $733.30 per tonne. The broad-based fall in commodity markets combined with news that India would allow additional exports to drive prices lower. "The question is what the system fund position is, we think it's maximum 10,000 lots, I think they're probably going to trim back further," a London-based broker said.
"The market could come off arguably another $100 or $200, but once the speculator length is removed from the market, there is no seller for months," said the broker, adding the outlook was bearish in the short-term but there was potential for prices to rise once speculator liquidation subsided. Arabica futures were slightly higher, with a bearish technical outlook weighing on the market, triggering speculative selling. "The majority of the selling in both markets has been speculative, there is daily hedging around of course, but origins don't like to sell into fresh lows," the London-based broker said.
New York coffee is expected to collapse to $1.9725 per lb over the next three months, based on its wave pattern, according to Reuters analyst Wang Tao. Sugar prices were steady, with raws having risen by around 10 percent over the past week, as a slow start to Brazil's harvest and port congestion in key producers was supportive.
"Prices have bounced from this year's lows of 20.4 cents/lb in May on expectations of Brazil's harvest being revised lower and logistical delays at Thai ports," Barclays Capital said in a daily commodities note. Dealers awaited further information on potential sugar exports from key sugar producer India, where the government is expected to hold a meeting on Thursday.
India's government could decide to allow more sugar exports at a meeting later on Thursday, Food Minister K.V. Thomas said, after industry calls for extra sales over the 500,000 tonnes allowed under Open General Licence (OGL) in December. India's sugar output is expected to rise to 26.00 million to 26.50 million tonnes in 2011/12, up 8-10 percent from 2010/11, Vinay Kumar, director of the National Federation of Co-operative Sugar Factories, said on Thursday. "The dollar is the prime motivator here. There has been some speculative interest on the buy side trying to drive it higher in London," a London-based broker said.