LONDON: Sugar futures on ICE fell to their lowest in more than three weeks on Thursday, pressured by weakening technicals and a looming global supply glut, partly fuelled by expectations for a record crop in Thailand.
SUGAR
March raw sugar was down 0.45 cents, or 3.1 percent, at 14.20 cents per lb by 1437 GMT. It hit a low of 14.17 cents, the weakest price since Dec. 19.
Dealers said technicals had deteriorated after prices fell below key moving averages, reinforcing bearish chart signals.
They also said it seemed that the bulk of hotly anticipated index fund buying had been done ahead of the official rebalancing period or post-settlement this week, making little impact on prices and souring speculative sentiment.
"The chatter about the index funds buying the market up has fallen away now," one dealer said. "So we're back to looking at it from other aspects."
Dealers said the focus was back on an expected global supply glut this season, with stronger than expected production in Thailand contributing to the pressure.
Thailand is expecting record output of sugar cane and refined sugar in 2017/18, boosted by favourable weather conditions, the government said.
Strong Thai output, coupled with a rebound in India's crop and a surge in EU production, has raised expectations for an even larger global surplus in 2017/18.
March white sugar was down $10, or 2.6 percent, at $377.60 a tonne after touching its weakest since Dec. 20.
"It seems the EU's 'looming pressure' is finally having an effect," Sucden Financial's Tom Kujawa said in a note.
COCOA
March London cocoa fell 14 pounds, or 1 percent, to 1,390 pounds a tonne.
March New York cocoa fell $13, or 0.7 percent, to $1,928 a tonne, retreating from a one-month high hit on Wednesday.
Dealers noted ample global supplies, with port arrivals having picked up pace this week.
Ivory Coast cocoa grinding for the season was up 2 percent by the end of December, data from exporters' association GEPEX showed on Thursday.
COFFEE
March arabica coffee was down 1.65 cents, or 1.3 percent, at $1.2230 per lb.
Brazil's 2018 coffee crop is expected to reach 53.2 million 60kg bags, 14.9 percent more than last year, mostly because of a positive year for arabica in a biennial crop cycle, statistics agency IBGE said on Thursday.
March robusta coffee was down $6, or 0.4 percent, at $1,720 a tonne.
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