LONDON: Raw sugar futures on ICE climbed to a seven-month high on Thursday with the recent run-up fuelled by fund buying while arabica coffee prices were slightly lower. March raw sugar ?was up 0.08 cent, or 0.6%, at 14.22 cents per lb at 1409 GMT after climbing to a seven-month peak of 14.24 cents earlier.
Dealers said funds continued to extend long positions against the backdrop of adverse weather in top exporter Brazil. "The path of least resistance remains to higher prices for now. We would caution though that the reversal from those highs is potentially nasty," Commonwealth Bank of Australia analyst Tobin Gorey said, adding that funds may soon reach the limit of their risk capacity and stop buying.
December white sugar rose by $1.50, or 0.4%, to $385.60 a tonne. Dealers were awaiting the release of production data from Centre-South Brazil covering the second half of September that may be issued by industry group Unica on Friday.
A survey of analysts conducted by S&P Global Platts saw sugar production for the period at 2.88 million tonnes, up 60.8%, year-on-year. December arabica coffee fell by 0.5 cents, or 0.5%, to $1.0910 per lb as a rebound from last week's more than two-month low of $1.0490 appeared to run out of steam.
Dealers said dry weather in Brazil remained a concern although some showers are forecast over the next few days. November robusta coffee fell by $10, or 0.8%, to $1,236 a tonne. Coffee prices in Vietnam fell for the third consecutive week after a drop in London prices, while premiums in Indonesia widened to compensate for a lower benchmark price, traders said on Thursday. December London cocoa fell by 5 pounds, or 0.3%, to 1,705 pounds. December New York cocoa was up $8, or 0.3%, at $2,460 a tonne.
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