LONDON: Raw sugar futures on ICE tumbled off the prior session’s five-month high on Wednesday as reports the US is seeking a ceasefire with Iran weighed on oil prices. Coffee and cocoa prices also fell.
SUGAR
Raw sugar fell 2.8percent to 15.44 cents per lb at 1211 GMT, having set a five-month high of 15.91 on Tuesday. Sugar had been boosted by fears that higher energy prices could prompt cane mills in top grower Brazil and elsewhere to lower sugar output in favour of ethanol, a cane-based biofuel. But dealers said speculators have since paused their short covering. Short trading essentially bets on price falls. “Does that mean the upside correction (in sugar) is finished? No, but it will either take another 1) Jump in crude or 2) An actual confirmation of El Nino showing up,” said broker and consultant Michael McDougall.
White sugar fell 2.6percent to USD450.60 a metric ton after hitting a 5-1/2 month high of USD463.60 on Tuesday.
COFFEE
Arabica coffee fell 0.8 percent to USD3.1545 per lb, after setting a seven-week high of USD3.1950 on Tuesday. Coffee is under pressure from the prospect of a record crop in top grower Brazil this year, but there is near-term tightness as farmers there are said to be holding back sales. Robusta coffee fell 0.4 percent to USD3,648 a ton, having gained 0.7percent on Tuesday.
COCOA
London cocoa fell 2.2percent to 2,350 pounds a ton, having settled up 1.4percent on Tuesday. Cocoa is under pressure from a generally favourable outlook for crops in West Africa coupled with weak demand, though much of that is priced in for now.
“The bearish trend established since early 2025 remains intact, though there is currently a lack of ‘momentum’ for any significant directional shift,” said a dealer. New York cocoa fell 2.1percent to USD3,168 a ton, having gained 1.7percent on Tuesday.
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