Raw sugar retreats, NY cocoa climbs to 8-week high

LONDON: Raw sugar futures on ICE were lower on Thursday, retreating from a near nine-month peak set earlier this week, although the market remained underpinned by tightening supplies with a global sugar deficit expected in the current 2020/21 season.

SUGAR

March raw sugar was down 0.17 cents, or 1.1%, at 15.28 cents per lb at 1443 GMT. The front month had peaked at 15.66 cents on Tuesday, its highest since mid-February.

Dealers said some profit taking had emerged after the recent run-up but the market remained underpinned by poor crop prospects in several major producing regions including the European Union.

"The past few days have seen several forecasters make hefty cuts to their estimates of EU sugar production. The news flow continues to support a rally," Commonwealth Bank of Australia analyst Tobin Gorey said.

Dealers said the market was also supported by uncertainty about India's sugar policy, with domestic stocks climbing but the government yet to discuss subsidising exports.

March white sugar was down $1.40, or 0.3%, at $415.50 a tonne.

COCOA

March New York cocoa was up $28, or 1.1%, at $2,608 a tonne after rising to a peak of $2,611, the highest since Sept. 24.

Dealers said the huge premiums commanded by the December contract in recent days had created a more bullish mood in the market with low exchange stocks limiting the amount of cocoa available to deliver against the contract.

March London cocoa was up 22 pounds, or 1.3%, at 1,765 pounds a tonne after peaking at 1,766, the highest since Oct. 1.

COFFEE

March arabica coffee rose 0.3 cents, or 0.2%, to $1.2315 per lb, edging up towards the prior session's two-month high of $1.2430.

The market was seeking to assess the damage caused by Storm Iota in central America, a major producing region for arabica coffee.

January robusta coffee rose $3, or 0.2%, to $1,405 a tonne.