LONDON: Raw sugar futures on ICE were slightly higher on Monday with the market consolidating after a steep fall late last week while arabica coffee and cocoa prices also rose.
July raw sugar rose by 0.05 cent, or 0.3%, to 17.01 cents per lb by 1417 GMT with the market finding some support after falling sharply late last week.
Dealers said weak consumption in India due to the Covid-19 pandemic and the prospect of a pick-up in exports from the South Asian country later in the year should keep a lid on prices.
“The current pandemic outbreak has impacted domestic sugar demand (in India),” analyst Green Pool said in a note, adding India’s sugar consumption was set to fall for the second year in a row in the 2020/21 season.
Lower demand is set to increase inventories in India and could lead to a pick-up in exports later in the year.
“If world prices are above 18 cents at the end of this year we can expect a flood of Indian export sales without subsidy; and if prices are below that level, we can be almost certain that the Indian government will be happy to grant a new export subsidy in line with world prices,” broker Marex said.
August white sugar fell by $0.80, or 0.2%, to $452.80 a tonne.
July arabica coffee was up 0.05 cent, or 0.03%, at $1.4505 per lb.
Dealers said supplies were tightening, with Brazilian arabica production set to fall this year and a container shortage in the South American country helping to slow down exports.
July robusta coffee fell by $6, or 0.4%, to $1,454 a tonne.
July London cocoa rose by 22 pounds, or 1.3%, to 1,711 pounds a tonne.
Unusually low rainfall last week in most of Ivory Coast’s cocoa-growing regions has reduced bean size and threatens to cut short the April-to-September mid-crop, farmers said on Monday.
July New York cocoa rose by $53, or 2.1%, to $2,527 a tonne.—Reuters
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