Arabica coffee closes up; raw sugar mixed

NEW YORK/LONDON: Arabica coffee prices closed up on Monday and raw sugar futures were mixed in a mild session.

Sugar had advanced earlier as prospects of poor crops in several countries including Thailand provided support, while cocoa prices were lower.

SUGAR

October raw sugar rose earlier in the session, but ended 0.04 cents lower, or 0.3%, at 13.06 cents per lb, having touched a five-month high of 13.28 cents on Friday.

The market has been boosted by declining production prospects in Thailand, Russia and the European Union, as well as stronger-than-expected demand from China.

"The lower EU beet crop and Thai cane crop continue to get plenty of attention and some are also now waking up to a strengthening La Nina event which still may not be of the magnitude of 2011 (but that won't stop parallels being drawn)," analysts Green Pool said in a report.

Sugar prices surged to the highest level in around 30 years in early 2011, boosted partly by a strong La Nina event that led to a drought in top producer Brazil.

October white sugar settled down $1.50, or 0.4%, at $379.70 a tonne.

COCOA

December New York cocoa settled down $25, or 1.0%, to $2,429 a tonne.

Below-average rainfall last week in most of top grower Ivory Coast's cocoa regions is expected to support the development of the upcoming main crop, with harvesting set to begin early, farmers said on Monday.

December London cocoa settled down 7 pounds, or 0.4%, to 1,681 pounds per tonne.

COFFEE

December arabica coffee settled up 1 cent, or 0.9%, at $1.1745 per lb.

A Brazil-based broker said producers have done basically all the hedging they had to do for the current crop, so if funds continue to build their long position in arabica they will not find much resistance from farmer selling.

There are rains expected for coffee areas in Brazil in coming days after a long dry spell, which could improve conditions for next year's crop.

November robusta coffee settled down $6, or 0.4%, at $1,378 a tonne.