NEW YORK/LONDON: Raw sugar futures on ICE extended gains to the highest in more than two months on Thursday, on chart-based strength after closing above the 100-day moving average the prior session, while the October whites discount widened sharply.
SUGAR
October raw sugar settled up 0.01 cent, or 0.1 percent, at 11.68 cents per lb after climbing to the highest since July 2 at 11.80 cents.
Total open interest continued to fall sharply as the spot contract rebounded above last month's 10-year low. It dropped by 31,823 lots to a six-month low at 875,376 lots on Wednesday, when futures rallied 4.4 percent, ICE data showed.
A pick-up in producer selling and profit-taking by traders who held long positions prevented steeper gains, while the prior session's rally above the October contract's 100-day moving average attracted technical buying, dealers said.
Fundamentals have also become less bearish with the crop outlook in the European Union diminishing while Brazil continues to focus on using as much cane as possible to make ethanol rather than sugar.
"The picture (on fundamentals) is still dire but not as dire as it was," one dealer said, noting, however the rise in prices increased the possibility of exports by India.
December white sugar settled up $3.60, or 1 percent, at $350.60 per tonne, after jumping to $357.60, the highest for the second-position contract since March 7.
The October contract, which expires on Friday, has slipped to an intraday discount of $24.90 to December after trading at a 30-cent premium five sessions prior.
"I think the long doesn't want it (the sugar) and is bailing. It is a bit of a horror show," one dealer said.
COCOA
December New York cocoa settled down $10, or 0.4 percent, at $2,315 per tonne.
"The December cocoa contract continues to try to find its way but cannot gain traction in either direction," said Peter Mooses, senior market strategist for RJO Futures in Chicago.
"Volatility in emerging markets is also hurting cocoa and adding to the risk sentiment felt in futures," he said.
December London cocoa settled down 16 pounds, or 1 percent, at 1,633 pounds per tonne.
Cocoa purchases declared to Ghana's Cocobod reached 870,000 tonnes in the 2017/18 crop year which ends on Thursday, more than the regulator had projected, three industry sources said.
COFFEE
December arabica coffee settled down 1.45 cent, or 1.42 percent, at $1.0065 per lb.
November robusta coffee settled down $16, or 1.1 percent, at $1,500 per tonne.
Comments
Comments are closed for this article.