LONDON: Raw sugar futures on ICE hit a fresh one month low on Wednesday amid worries about interest rate hikes in the wider financial markets, and expectations for higher production from Brazil, India and Thailand. New York cocoa hit its lowest in 6-1/2 months meanwhile.
SUGAR
July raw sugar fell 0.8% to 18.56 cents per lb at 1257 GMT - its lowest in a month.
Dealers said higher production expectations from top producers Brazil, India and Thailand suggest there will be more than adequate supply of sugar next year.
This is pressuring sugar, as is a surging dollar, which is at near 20 year highs, making dollar-priced commodities like sugar costlier for non-US investors.
Still, dealers said sugar should find support below 18.60 cents because some of the above is already priced in.
Europe’s largest sugar producer, Suedzucker, on Wednesday increased its full-year guidance, saying it expects to pass price increases in raw materials and energy on to new customer contracts.
August white sugar fell 0.7% to $565 a tonne.
COFFEE
September arabica coffee fell 0.9% to $2.25 per lb.
Prices were underpinned by falling ICE certified arabica stocks and record high premiums in the physical market, though worries over a weakening Brazilian real are weighing.
A weak real tempts exporters in top producer Brazil to sell by raising returns in local currency terms.
September robusta coffee fell 0.7% to $2,037 a tonne.
COCOA
September New York cocoa fell 0.7% to $2,352 a tonne, having hit its lowest since early December at $2,346.
Demand concerns are weighing on cocoa, as is ICE data showing cocoa stocks are not far off their highest in nearly a year.
September London cocoa fell 0.6% to 1,729 pounds per tonne.
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