Arabica coffee futures on ICE fell for the third consecutive session on Monday, pressured by expectations of plentiful supplies and renewed speculative selling as chart signals weakened, while sugar and cocoa also slipped. March arabica coffee settled down 1.1 cent, or 1.1 percent, at $1.0275 per lb.
Prices were pressured by an upwardly revised production forecast from Comexim, a top Brazilian coffee exporter, dealers said. Comexim lifted its 2019 Brazil output forecast to 63.05 million bags from 60.7 million bags.
Last month, the US Department of Agriculture pegged Brazilian output for 2019 at 63.4 million bags. Low global prices have not yet prompted Brazilian farmers to scale back on their care for their crops, Comexim noted in its report. The market was also correcting after last week's run-up to a five-week peak, dealers said.
"It's the last day of the index fund buying today and I think it's had an influence," said one European dealer, noting sellers were keen to take advantage of the window of opportunity.
Weakening chart signals added pressure after the market failed to hold above the 10-day moving average, dealers said. Coffee is a booming business for Western retailers but farmers are facing a crisis as arabica prices hover near 13-year lows.
March robusta coffee settled down $15, or 1 percent, at $1,528 per tonne. March raw sugar settled down 0.03 cent, or 0.2 percent, at 12.75 cents per lb. Last week, the contract gained 7.1 percent, its best weekly performance since early October.
"The market consensus is that the system funds have been buying back shorts but are still net short," Marex Spectron said in a report. The monthly contract closed above the 200-day moving average for the sixth consecutive session, a supportive signal, one US trader said. March white sugar settled down $1.40, or 0.4 percent, at $343.50 per tonne.
Indonesia may not import white sugar for household use in 2019, according to officials. May London cocoa settled down 19 pounds, or 1.1 percent, to 1,709 pounds a tonne. March New York cocoa settled down $15, or 0.6 percent, at $2,341 per tonne.
Arrivals at ports in top grower Ivory Coast reached 1.195 million tonnes between Oct. 1 and Jan. 13, exporters estimated, up around 12 percent year-on-year. Market participants were awaiting data on the fourth quarter cocoa grind for 2018, a demand indicator. European data is due on Wednesday and North American data the following day.
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