Robusta coffee eases as Brazil import hopes fade

Robusta coffee futures slipped on Wednesday as hopes faded that tight supplies would convince Brazil to import for the first time in decades. The sugar market set its focus on upcoming expiries, while New York cocoa slumped to its weakest in more than five years. March robusta coffee futures were down $31, or 1.43 percent, at $2,141 at 1501 GMT.
Marex Spectron on Wednesday forecast a global coffee deficit of 3.0 million 60-kg bags for the 2017/18 season as production in top grower Brazil declines. "Already at this very early stage, it is probable that there will be a fourth deficit and possibly a large fourth deficit. And in 2017/18 there will be no government or private producer stocks to fill the gap," Marex said.
Bullish tone fades as Brazilian coffee farmers insist stocks total 4 million (60-kg) bags and imports are not necessary. The government said it would audit the numbers and make a decision.
Market had rallied on expectations tight supplies would prompt Brazil to import robusta.
"It looks like it's less and less possible as they keep pushing it down the road," said one dealer. "The market has maybe priced some of that in."
March arabica coffee fell 0.15 cents, or 0.11 percent, at $1.4245 per lb.
March raw sugar rose slightly by 0.02 cents, or 0.10 percent, to 20.74 cents per lb, after tumbling 2.27 percent in high volume the previous session.
March white sugar down $1.70, or 0.31 percent, at $543.70 a tonne.
Market focus on upcoming March expiry for both white and raw sugar, with expectations Mexico could deliver white sugar typically bound for the United States.
"There is a limit in place on the volume it can export under a trade suspension agreement between the two countries," INTL FCStone said in a report. "We heard the longer the situation continues, the challenge for Mexico to place sugar will increase."
New York March cocoa fell $15, or 0.75 percent, to $1,990 a tonne after touching a new five-year low of $1,989 earlier, its weakest since December 2011.
May London cocoa was down 18 pounds, or 1.10 percent, at 1,623 pounds a tonne, touching its lowest since September 2013 as a steadier pound added extra pressure.
Worries over a supply glut outweighed renewed unrest in top grower Ivory Coast.