LONDON: Arabica coffee futures on ICE sank below $2 per lb on Thursday to a 9 month low as bearish technical signals triggered selling by funds and as exports from top producer Brazil continued to pick up pace.
New York cocoa futures on ICE hit a two year low meanwhile.
September arabica coffee fell 4.7% to $1.9735 per lb by 1454, having hit its lowest since October at $1.9570.
Dealers said technical buy signals have collapsed while fears are fading that frosts will hit Brazil’s coffee areas and destroy next season’s crop.
Exports from Brazil for this season’s crop are meanwhile picking up pace. According to exporters association Cecafe, Brazil’s arabica shipments reached 2.652 million bags in June, up 11.5% year-on-year.
Arabica is also under pressure from a weak Brazilian real , which encourages selling of dollar-priced arabica by raising returns in local currency terms.
September robusta coffee fell 2.6% to $1,931 a tonne.
Dealers said Brazil is nearing the end of its robusta harvest, with grain quality good and productivity excellent.
September New York cocoa fell 2.6% to $2,243 a tonne, having hit its lowest since July 2020 at $2,237.
Dealers cited a report by Reuters that consumers are cutting back on chocolate due to the cost of living crises in Europe and the United States.
The North American second-quarter cocoa grind, a proxy for demand, is scheduled for release on July 21.
September London cocoa fell 1.7% to 1,690 pounds per tonne?, having hit its lowest since early March at 1,682.
October raw sugar fell 1% to 18.94 cents per lb, having hit a one-month high in the previous session.
Dealers said it is difficult to see sugar advancing much with the dollar index remaining near 20-year highs.
They added however, near term tightness in white sugar, linked in part to India’s export constraints, should limit losses in raws.
August white sugar rose 1.5% to $596.70 a tonne.