Arabica coffee prices weaken, sugar also down

LONDON: Arabica coffee futures on ICE fell on Wednesday, weighed partly by a further weakening in the currency of top producer Brazil, while sugar prices also slipped.

COFFEE

May arabica coffee fell by 0.75 cents, or 0.6%, to $1.3375 per lb at 1517 GMT after rising to a peak of $1.3565, its highest since March 1.

Dealers said weakness in Brazil's real currency helped to trigger a bout of profit-taking after the market's recent run-up. The country's government on Wednesday raised its inflation outlook sharply.

A weaker real increased prices in local currency terms in Brazil and can spark a pick-up in producer selling.

Dealers were keeping watch on the worsening COVID-19 situation in Brazil, with the record pace of deaths potentially leading to tighter restrictions.

May robusta coffee rose by $5, or 0.4%, to $1,411 a tonne.

SUGAR

May raw sugar fell by 0.25 cents, or 1.5%, to 16.05 cents per lb.

Dealers said the market remained rangebound, with solid support around 15.85/15.90 cents and resistance at about 16.50/16.55 cents.

Indian mills have contracted to export 4.3 million tonnes of sugar so far in the 2020/21 season ending on Sept. 30, a trade body said on Wednesday, as a rally in global prices to a four-year high and an export subsidy make overseas sales lucrative.

May white sugar fell by $5, or 1.1%, to $458.40 a tonne.

COCOA

May London cocoa fell by 3 pounds, or 0.2%, to 1,734 pounds a tonne.

Dealers said the market was keeping a close watch on May's premium to July to see if there were also any signs of tightness in available supplies. The March contract expired on Tuesday at a substantial premium.

A total of 52,860 tonnes of cocoa was tendered against the ICE March London cocoa contract, exchange data showed on Wednesday.

May New York cocoa fell by $13, or 0.5%, to $2,513 a tonne.