Raw sugar steadies as traders eye Brazil output, rising oil, grains prices

LONDON: Raw sugar futures on ICE steadied on Monday, underpinned by a weaker dollar, gains in oil and grains prices and ongoing concerns top producer Brazil will cut back sugar output this season.

SUGAR

July raw sugar dipped 0.3% to 19.89 cents per lb at 1527 GMT, having hit a one-month high of 20.24 cents last week.

Speculators increased their net long position in ICE raw sugar futures by 22,210 contracts to 81,034 in the week to May 17, data showed.

Dealers said sugar looks set to remain firm near term as macro-economic signals are supportive and concerns over production in Brazil remain upmost in traders’ minds.

Brazilian cane mills are expected to favour production of ethanol, a cane-based biofuel, over sugar this season due to rising energy prices.

Egypt expects to produce 2.8 million tonnes of sugar in the current year compared to 3 million tonnes last year, the agriculture ministry told Reuters.

August white sugar fell 0.5% to $555.50 a tonne.

COFFEE

July arabica coffee fell 0.3% to $2.1535 per lb??.

Speculators increased their net long position in ICE arabica coffee futures by 7,933 contracts to 21,305 in the week to May 17, data showed.

Coffee experts on Friday said light frosts in top coffee producer Brazil had left crops largely unscathed.

July robusta coffee fell 0.8% to $2,039 a tonne.

COCOA

July New York cocoa rose 0.7% to $2,448 a tonne, having hit its lowest level since early November at $2,404 on Friday.

Speculators increased their net short position in ICE New York cocoa futures by 1,819 contracts to 4,656 in the week to May 17, data showed.

Soil moisture compensated below-average rainfall in most of Ivory Coast’s cocoa-growing regions last week as the April-to-September mid-crop continues to develop and yield large fruit, farmers said.

Cocoa arrivals at ports in top grower Ivory Coast reached 1.874 million tonnes between Oct. 1 and May 22, down 4.5% from the same period last season, exporters estimated.

September London cocoa edged up 0.1% to 1,745 pounds per tonne????, having hit its lowest since December at 1,734.