Raw sugar gains as wider financial market jitters abate

LONDON: Raw sugar futures on ICE rose on Tuesday, edging further from Monday's three-week low as world stocks rose on reassuring comments from US Federal Reserve officials.

Sugar

March raw sugar rose 0.5% to 18.32 cents per lb at 1123 GMT, recovering after hitting the lowest price since Jan. 11 on Monday at 17.90 cents.

Dealers said the market has a bearish bent given a growing view that production is increasing more than was anticipated when the season started.

They added, however, much can still change, especially regarding the crop recovery in top producer Brazil from last year's drought.

A small global sugar deficit of 742,000 tonnes is anticipated in the 2022/23 season, commodity specialists Green Pool said in its first forecast for the period. It forecast the 2021/22 deficit at 2.03 million tonnes.

Sugar producers have sharply reduced their hedge selling volumes on ICE as oil's recent surge has spurred cane mills that also produce ethanol to weigh boosting production of the biofuel at the expense of sugar.

March white sugar rose 0.3% to $493.90 a tonne.

Raw sugar extends losing streak, robusta hits 3-month low

Coffee

March robusta coffee rose 1.2% to $2,201 a tonne, recovering from a three-month low of $2,161 set on Monday as data showed rising exports from top producer Vietnam.

March arabica coffee rose 1.6% to $2.3875 per lb, having sunk to a three-week low last Friday.

Dealers said arabica has been under pressure from worries over rising interest rates, which strengthen the dollar - making dollar-priced coffee expensive - and deter traders from buying by raising their borrowing costs.

Cocoa

March London cocoa rose 2.2% to 1,741 pounds per tonne, with the market underpinned by concerns about dry weather in top producer Ivory Coast.

There has been no rain for a second straight week in most of Ivory Coast's cocoa-growing regions, farmers said on Monday.

Cocoa port arrivals in Ivory Coast reached 1.340 million tonnes between Oct. 1 and Jan. 30, exporters estimated, up 1.5% from the same period last season.

March New York cocoa rose 2.5% to $2,591 a tonne.