Coffee closes up in wild session with largest volume since December
- Raw sugar saw a similar move as prices went up earlier to a 4-1/2 month peak as a weaker dollar drove fund buying of commodities, but returned those gains to close down.
- Dealers said fund buying took the market up to a point where it attract heavy producer selling.
NEW YORK/LONDON: Arabica coffee futures on ICE closed slightly up after a very active session on Wednesday when prices went up as much as 5% earlier in the day and then dropped into negative territory, before reversing course.
Raw sugar saw a similar move as prices went up earlier to a 4-1/2 month peak as a weaker dollar drove fund buying of commodities, but returned those gains to close down.
COFFEE
September arabica coffee settled up 0.5 cents, or 0.4%, at $1.2155 per lb, having earlier touched the highest level since March 26 at $1.2725.
Trading volume in the first position reached 35,319 contracts, the highest since Dec. 2.
Dealers said fund buying took the market up to a point where it attract heavy producer selling.
"I won't be surprised if there was big producer selling overhead," said one broker.
"Other commodities markets were shaky too, coming off pretty hard," he said.
The International Coffee Organization revised its forecast for the global coffee market balance in the current 2019/20 season, predicting a deficit of 486,000 60-kg bags.
September robusta coffee settled down $25, or 1.8%, at $1,379 a tonne.
SUGAR
October raw sugar settled down 0.24 cents, or 1.9%, at 12.54 cents per lb, having earlier hit a 4-1/2-month high of 12.96. The negative closing on Wednesday ended a four-session rally.
A broker noted that Brazilian currency had not gained against the dollar as most other currencies did, which could have spurred selling from mills in Brazil on Wednesday.
"Prices are benefiting from positive news on demand and uncertainties regarding future (supply) in India, Thailand and Europe," said consultants Agritel.
October white sugar settled down $5.40, or 1.4%, at $369.20 a tonne.
COCOA
December London cocoa settled up 3 pounds, or 0.2%, to 1,677 pounds per tonne.
December New York cocoa settled up $27, or 1.1%, to $2,474 a tonne.
"The recent chart rally in New York is likely to lose steam at $2,400-2,500/t. An uneven economic recovery, the likely cancellation of Halloween and live events remain concerns," said Citi.
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