LONDON: Arabica coffee futures on ICE rose sharply on Wednesday, supported partly by concern over by weaker than expected exports from Central America, while raw sugar prices extended their rebound from a recent one-year low.
COFFEE
September arabica coffee rose 3.6% to $2.1745 per lb by 1411 GMT.
The market continued to be buoyed by concern about tight supplies, with ICE certified stocks at the lowest level in more than 20 years while recent strength of Brazil’s real currency also provides support.
“A strong Brazilian real will likely slow down Brazil exports. Also exports from Honduras and other mild producers have been disappointing in the last few months. This, coupled with rapidly depleting certified stocks, may cause spot prices to rise further,” Rabobank said in a market update.
Dealers said the market was also keeping a close watch on whether any economic downturn would curb demand for coffee.
JDE Peet’s on Wednesday reported organic sales growth of 15.7% for the first six months of 2022 while noting it expects the business environment to remain volatile for the remainder of the year as input cost inflation, geopolitical unrest and pandemic effects persist.
September robusta coffee rose 1% to $2,048 a tonne.
SUGAR
October raw sugar rose 1.3% to 17.92 cents per lb. The front month fell to a one-year low of 17.20 cents on Monday.
Dealers said fund selling, against the backdrop of concern about a global economic downturn, had contributed to recent price declines but the pace has slowed in the past couple of sessions.
October white sugar rose 1.1% to $527.80 a tonne.
COCOA
September New York cocoa fell 1.6% to $2,302 a tonne.
December London cocoa fell 1.2% to 1,759 pounds a tonne.
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