LONDON: Raw sugar futures fell to a 2-1/2 year low on Tuesday as the market extended its prolonged slide driven by oversupply, while arabica coffee dipped to the lowest in more than nine months.
SUGAR
May raw sugar was down 0.17 cent, or 1.4 percent, to 11.81 cents per lb at 1356 GMT, after slumping to a 2-1/2 year low of 11.77 cents.
Dealers said the market continued to be driven down by excess supplies, although there has been some buying by end-users.
The potential for lower sugar output in Centre-South Brazil, where the new cane processing season is now underway, may provide support, although the scope for any significant rebound remains capped by strong production in India and Thailand.
"Any weather event in Brazil affecting the start of the Centre South crush may have a psychological impact, given the almost record net short held by the speculative and fund community, but we expect any rally to be ephemeral and of short duration given production elsewhere," said Nick Penney, senior trader with Sucden Financial in a market note.
Dealers said volumes were boosted by rolling forward of positions out of May into July, with position limits set to be imposed on the front month on Wednesday.
August white sugar fell $2.20, or 0.65 percent, to $338.40 per tonne, after dipping to a low of $336.00 - the weakest for the front month since September 2015.
COFFEE
July arabica coffee was down 0.30 cent, or 0.3 percent, at $1.1625 per lb after dipping to a low of $1.1550, the weakest for the second position since June 2017.
Dealers said the prospect of a record crop in top producer Brazil this year continued to weigh on prices.
"The Brazil crop remains healthy and there are no potential threats around the corner, with weather conditions looking favourable," INTL FCStone in Singapore said in a market note.
July robusta coffee was up $3 at $1,732 a tonne.
COCOA
July New York cocoa was unchanged at $2,704 a tonne after rising to a peak of $2,725, its highest since October 2016.
Dealers said the market had been supported mainly by technically-driven buying.
They noted concerns that heavy rain could damage the Ivory Coast mid-crop also provided background support.
Dealers said first-quarter grind data should provide a focus this week, with data from Europe on Wednesday, North America on Thursday and Asia on Friday.
July London cocoa was down 6 pounds, or 0.3 percent, at 1,820 pounds a tonne, weighed down by a strong pound.
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