Arabica coffee hits 4-1/2 year high on Brazil frosts
- September robusta coffee fell 1.1% to $1,742 a tonne, having hit a three year high of $1,793 on Tuesday
- October raw sugar fell 0.9% to 17.27 cents per lb, having closed up 2% on Tuesday
LONDON: Arabica coffee futures on ICE hit 4-1/2 year highs on Wednesday as investors assessed the damage done to crops in top producer Brazil from frosts a day earlier, the second to hit the crop in a month.
COFFEE
September arabica coffee rose 0.1% to 169.90 by 1100 GMT, having earlier hit its highest since late 2016 at $171.20. The contract closed up nearly 7% on Tuesday.
September robusta coffee fell 1.1% to $1,742 a tonne, having hit a three year high of $1,793 on Tuesday.
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Dealers said Brazil's coffee crop, which is still flowering, could have lost 1-2 million bags due to the frosts, which hit key coffee growing areas like Minas Gerais and Sao Paulo states.
They added however that conditions should warm to above freezing on Wednesday.
Coffee trees are extremely sensitive to frost, which kill leaves and can hamper the production potential for the next crop.
SUGAR
October raw sugar fell 0.9% to 17.27 cents per lb, having closed up 2% on Tuesday.
While frosts also hit some sugar cane areas in Brazil, dealers said the affected areas had already been harvested and a repeat of frosts in the same areas could not do much more damage.
Still, top sugar producer Brazil already has a smaller cane crop this year due to a drought and the frosts over the past month have further hurt production.
Dealers said on balance, shrinking Brazilian output should more than offset worries over the rapid spread of the Delta coronavirus variant, boosting sugar prices.
October white sugar fell 0.5% to $446.90 per tonne, having closed up 1.2% on Tuesday.
COCOA
September London cocoa rose 2.2% to 1,594 pounds per tonne, having hit its lowest in a year last week.
London cocoa hits 1-1/2 month peak, raw sugar hits 2-week trough
Cocoa remains under pressure from this season's record output in Ghana, the world's second-biggest producer, despite some positive data on demand recovery recently.
September New York cocoa rose 0.9% to $2,278 a tonne.
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