LONDON: Raw sugar futures rose to a three-week high on Monday, boosted partly by gains in grain prices following India’s decision to ban exports of wheat, while coffee and cocoa prices also rose.
July raw sugar rose 0.9% to 19.34 cents per lb by 1211 GMT after peaking at 19.70 cents - the highest level since April 22.
Dealers said an increase in the cost of grains can boost prices of ethanol and lead to more use of cane to produce the biofuel.
A deteriorating outlook for cane production in the key Centre-South region of Brazil has also been supportive.
“Estimates of CS (Centre-South) Brazil cane tonnage are coming down slightly, as it becomes clear that the quality of this year’s cane varies widely,” broker Marex said in a note, adding some regions were suffering acutely following drought, frost and fires last year.
August white sugar rose 0.8% to $540.20 a tonne.
July arabica coffee rose 1.9% to $2.1795 per lb.
Dealers were keeping a close watch on the weather in top producer Brazil with temperatures expected to drop although not low enough to damage crops.
July robusta coffee rose 0.85% to $2,056 a tonne.
Uganda’s coffee exports declined 24% year-on-year in April as a drought in some parts of the country cut yields, the state-run sector regulator Uganda Coffee Development Authority (UCDA) said on Monday.
July New York cocoa rose 1.9% to $2,515 a tonne.
Heavy rain in most of Ivory Coast’s cocoa-growing regions last week will spur growth of the April-to-September mid-crop but could cause mouldy beans, farmers said on Monday.
July London cocoa rose 1.35% to 1,803 pounds a tonne.