LONDON: Raw sugar futures on ICE hit a 5-1/2 month low on Monday, extending a weak start to the year as supply prospects continued to improve while risk appetite soured in the wider financial markets.
SUGAR
March raw sugar fell 2.3% to 17.63 cents per lb at 1452 GMT, after hitting its lowest since late July at 17.61 cents.
Dealers said more rains are forecast for top sugar producer Brazil over the next 10 days, improving the crop outlook. Cane harvests in India and Thailand have also started well.
All the same, dealers said, sugar’s downside seems limited from here given prices have fallen below the ethanol parity in Brazil, which should tempt cane mills to divert some production from sugar to ethanol.
March white sugar fell 1.5% to $478.70 a tonne.
COCOA
March New York cocoa fell 0.6% to $2,506 a tonne, having settled up 4% on Friday.
The cocoa grind, a measure of demand, in top producer Ivory Coast rose nearly 2% year-on-year in December to 52,000 tonnes, data showed on Monday.
Ivory Coast vies with the Netherlands for position of the world’s top cocoa grinder.
Fourth-quarter grinding data for Europe, Asia and the US, to be released next week, is also expected to be show improved demand, dealers said.
In supply-side news, cocoa arrivals at ports in top grower Ivory Coast fell 6.4% year on year, from the season in October to Jan. 9.
March London cocoa fell 0.6% to 1,694 pounds per tonne, having closed up 3.1% on Friday.
COFFEE
March arabica coffee fell 1.9% to $2.3405 per lb??.
Weather forecasters are predicting rains in top coffee producer Brazil will taper off over the main growing areas during the next weeks.
Arabica has been boosted of late by rains that have flooded coffee fields in central eastern areas in Brazil, the latest in a climate roller-coaster for the country.
Starbucks customers arriving to claim their mobile drink orders have found cafes shut as service at US restaurants slows due to COVID-19, with many workers sick or scared to go to work.
March robusta coffee fell 3% to $2,248 a tonne, having hit a one month low of $2,246 earlier.
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