LONDON: Raw sugar futures on ICE headed away from this week’s over-one-year peak on Friday under pressure from ample near-term supply and weak demand while coffee and cocoa also fell.
SUGAR
Raw sugar dipped 0.4percent to 16.75 cents per lb at 1025 GMT, having risen to a more than one-year high of 17.11 cents on Wednesday.
Deepcore, a physical sugar broker, said exporters have stocks while Asian and Middle Eastern importers are stay on the sidelines at present.
It also noted sugar is now paying around 20percent above ethanol in top grower Brazil, which means mills there are likely to ramp up production of the sweetener. In the medium term though, the broker expects the market to move into deficit for the 2026/27 season as production problems build up in Brazil and No. 2 grower India.
In news, the US Climate Prediction Center said the El Nino weather pattern is strengthening, with a greater than 90percent chance of a very strong event during the northern hemisphere fall and winter 2026-27.
For sugar, El Nino typically brings excess rain in the second half of the year in Brazil, and excess dryness in India and No. 2 exporter Thailand. White sugar fell 0.2percent to USD517 a metric ton.
COFFEE
ICE arabica coffee fell 0.8percent to USD3.1035 per lb, having hit a three-week high earlier this week. Dealers said the rally in prices in top grower Brazil has finally prompted farmers there to ramp up sales but added there is a limit to the move given supply risks associated with El Nino.
Elsewhere, the recent Colombia earthquake has disrupted coffee exports from the world’s second-largest arabica grower. Some traders expect logistics issues in Colombia to last for around 15 days, until roads are fixed. Robusta coffee fell 1percent to USD3,606 a ton, having hit a 1-1/2 month low earlier.
COCOA
ICE London cocoa fell 1.25percent to £4,111 per ton. * “The industry, producers and major speculators are currently keeping a low profile and are awaiting the pod counts in August as well as the start of the new harvest,” said a dealer. New York cocoa lost 1.2percent to USD5,652 a ton.
Comments