Robusta coffee futures were mostly higher on Friday, though the closely watched front-month premium weakened in thin volumes with US markets shut. White sugar also rose and cocoa ended marginally lower. Robusta traders focused on the July/September spread, which fell back to about $95 a tonne after peaking earlier in the session at around $135.
The premium has risen sharply during the past couple of weeks, boosted by supply tightness driven in part by hoarding by Vietnamese producers. "We think this spike will prove temporary. With Indonesia's harvest now under way and the need for producers in Vietnam to sell stocks before the start of their harvest in October, the price of robusta should fall over the near term," Capital Economics analyst Hamish Smith said in a market note.
September robusta ended $3 higher at $1,748 a tonne. London white sugar futures edged higher in thin volumes as expectations that there could finally be a global deficit in 2015/16 helped to underpin the market. Rabobank said in its latest quarterly report that better than expected sugar production from India and Thailand appeared to have consolidated a global surplus projected for 2014/15, bringing stocks to record levels.
"The sugar pipeline is full for the major importers after a prolonged period of low prices, suggesting that further price falls will do little for immediate sugar demand," Rabobank said. "The preliminary global supply/demand balance for 2015/16 looks headed for a deficit after five consecutive years of surplus, but the impact on prices may be limited."
August white sugar futures ended $2.80 higher at $371.10 a tonne. London cocoa futures eased, with dealers turning their attention to quarterly cocoa grind data, a measure of demand, due to be released in Europe on July 14 and North America on July 16. September London cocoa was down a marginal 3 pounds, or 0.1 percent, at 2,181 pounds a tonne.
Comments
Comments are closed.