LONDON: Raw sugar futures on ICE hit an 18-month peak above 19 cents on Friday as the market continues to price in a deficit next season. Coffee and cocoa prices also gained.
SUGAR
Raw sugar rose 2.2percent to 19.36 cents per lb by 1001 GMT after peaking at an 18-month high of 19.37 cents. The contract was heading for gains of 10percent this week as traders focus on the deteriorating production outlook and discount current ample supplies. Brazilian production dropped 41.6percent in the first half of September as rains continue to disrupt fieldwork.
“The outlook for the 2026/27 season has deteriorated significantly. In addition to higher oil prices, concerns about the upcoming harvest due to the El Nino weather phenomenon have become a key driver,” said Commerzbank. The bank pointed out El Nino is expected to affect the crops of all three top growers — Brazil, India and Thailand. The coming EU crop is also likely to take a sharp hit from this summer’s drought, it added.
“Should these adverse weather conditions persist, further price increases are likely,” Commerzbank added. White sugar gained 2.7percent to USD521 a metric ton.
COFFEE
Arabica coffee rose 2.6percent to USD2.9560 per lb, heading for gains of 6percent this week. Arabica has been boosted partly by quality concerns over Brazil’s 2026 crop owing to excess El Nino-linked rains. The market is also oversold after a steep decline from peaks set in late August.
“Prices should continue to fall. We continue to expect further volumes of coffee to reach the exchange in November and December,” said Rabobank. Robusta coffee rose 2.6percent to USD3,357 a ton.
COCOA
New York cocoa was up 2percent at USD5,489 a ton after hitting a two-month low of USD5,051 on Thursday. Cocoa is under pressure from excess supplies after a large global surplus in the 2025/26 season (October/September), though the coming crop has probably taken a hit from adverse El Nino-linked weather.
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