LONDON: Raw sugar futures on ICE hit scaled a seven-month peak on Wednesday, disregarding jitters in wider financial markets, with support from worries over adverse weather in several producing regions.
March raw sugar was up 0.2 cents, or 1.2%, at 14.05 cents per lb at 1400 GMT, having touched its highest since early March at 14.10.
Dealers cited concern over adverse weather in top exporter Brazil, as well as in Thailand and Russia, in addition to disease problems in the European Union.
“Brazil has been facing a major drought for several months. The level of rainfall in the next month will become an essential driver of prices,” Agritel analysts said in a note.
December white sugar rose $3.40, or 0.9%, to $382.30 a tonne, having hit its highest since mid-June at $384.20.
December arabica coffee rose 0.9 cents, or 0.7%, to $1.0845 per lb, having hit a more than two-month low of $1.0490 on Friday.
Arabica is under pressure from a record harvest in top producer Brazil while demand has been hit by continuing coronavirus restrictions at cafes and restaurants.
Exchange stocks edged slightly off their 20-year lows at last count, with dealers noting the successful grading of some supplies from Brazil.
“The market will be focused on the amount of semi-washed from Brazil hitting the exchange, and we believe the coffee will arrive and the (grading pass) rate will improve,” Rabobank said.
Brazil will have a below-average coffee crop in 2021 owing to prolonged drought in recent months, local agronomists said.
November robusta coffee fell $15, or 1.2%, to $1,240 a tonne.
December London cocoa fell 2 pounds, or 0.2%, to 1,695 pounds a tonne.
December New York cocoa fell $17, or 0.7%, to $2,420 a tonne.
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