London cocoa pares gains after touching two-month high

London cocoa futures on ICE rose to a two-month high before paring gains on Monday, as rain in top grower Ivory Coast boosted hopes for improved crop output and the rising British pound provided a source of pressure. Raw sugar turned lower, falling away from the prior session's six-week high, and arabica coffee dropped, with both markets feeling pressure from a softer Brazilian currency, which attracts producer and speculative selling.
May London cocoa settled up 1 pound, or 0.05 percent, at 2,212 pounds a tonne, after touching a peak of 2,227 pounds a tonne, its highest since January 4. May New York cocoa settled up $2, or 0.1 percent, at $3,010 per tonne, not far from Friday's peak of $3,018, the highest since January 8. Rains and humid weather have raised growers' hopes in most of Ivory Coast's main cocoa regions, where a drought and severe Harmattan winds had battered plants ahead of the April-to-September mid-crop, farmers said.
Coffee and Cocoa Council (CCC) data seen by Reuters showed that 2015/16 arrivals at ports in Ivory Coast reached 1,172,128 tonnes by the end of February, below exporters' estimates of 1,194,452 tonnes. May raw sugar settled down 0.17 cent, or 1.2 percent, at 14.66 cents per lb, having climbed on Friday to the highest since January 19 at 14.93 cents, largely ignoring potential supply concerns. "As the new harvest gets going (from the end of this month), rains will impede the harvest and tend to cause mills to favour ethanol rather than sugar production," Marex Spectron said in a weekly report.
The market also took note of the early closure of mills in India, due to a lack of cane. Consultancy Agrilion said analyst Green Pool had cut its output forecasts for China and north Brazil still further although both campaigns were well advanced. May white sugar settled down $2.20, or 0.5 percent, at $421.60 per tonne. Claudiu Covrig, senior agricultural analyst with data supplier Platts, said he expected strong physical demand for white sugar to propel demand for raws. "I expect the whites (refining) premium to stay strong for a while," he said. May arabica coffee settled down 0.15 cent, or 0.1 percent, at $1.209 per lb. May robusta coffee settled up $1, or 0.1 percent, at $1,394 per tonne.