NEW YORK/LONDON: Raw sugar futures on ICE slid to a three-month low on Monday as funds scaled back long positions against the backdrop of bearish price charts and weak demand in Europe, while coffee also fell.
May raw sugar settled down 0.27 cent, or 1.8%, at 14.92 cents per lb, after slipping to a three-month low of 14.84 cents.
Dealers said price charts had become more bearish after recent weakness, while concern about nearby supply tightness had eased partly due to a stronger-than-expected finish to the harvest in key exporter Thailand.
Funds cut their long position on raw sugar in the week to March 23.
“The funds, who started the year in a very ebullient mood (on sugar), seem to be throwing in the towel as prices fall through key support levels,” analyst Green Pool said in a weekly market update.
Weak demand in Europe linked to a third wave of the COVID-19 pandemic also weighed on sentiment.
May white sugar settled down $6.00, or 1.4%, at $431.10 a tonne.
May arabica coffee settled down 1.45 cents, or 1.1%, at $1.2705 per lb.
Dealers noted funds were also scaling back long positions in arabica coffee.
Brazilian brokers said producers in the world’s largest grower were again active sellers in the market after the country’s currency weakened to the lowest level in 20 days.
May robusta coffee settled down $23, or 1.6%, at $1,376 a tonne.
Vietnam coffee exports in the first three months of the year are estimated to have fallen 17% from a year earlier to 428,000 tonnes.
May New York cocoa settled down $22, or 0.9%, to $2,436 a tonne as the market continued to consolidate just above a five-week low for the contract of $2,415 set on March 24.
May London cocoa settled down 4 pounds, or 0.2%, to 1,734 pounds per tonne, weighed down by a stronger pound.
Climate42 said that for the first time since 2017 the March average pod load in Ghana is above 9 pods per tree, a positive sign for the mid crop.
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