LONDON: Arabica coffee futures on ICE rose sharply on Tuesday boosted by technically-driven buying as the recent rebound in prices continued to gather momentum.
Prices had slumped to a 13-1/2 year low this month.
COFFEE
July arabica coffee was 2.55 cents, or 2.7pc , higher at 95.85 cents per lb at 1420 GMT.
"Technically, the market is trying to break higher. If we can have a decent close we could see more short covering," one dealer said.
A slight recovery in Brazil's real currency was also supportive.
A firmer real can discourage producer selling of dollar-denominated commodities such as coffee.
July robusta coffee was up $6, or 0.4 percent, at $1,368 a tonne.
Kenyan coffee production in 2019-20 is seen dropping to 650,000 bags, the US Department of Agriculture (USDA) attache in Nairobi said, representing the country's lowest production in over 50 years, according to historical USDA data.
SUGAR
July raw sugar was up 0.01 cent, or 0.1pc , to 11.67 cents per lb.
Dealers said the market was underpinned by continued strong demand for hydrous ethanol in Brazil, which had encouraged the use of a high percentage of cane to produce the biofuel rather than sugar.
Other supportive factors include signs that consumption in the European Union may have been stronger than expected, helping tighten supplies in the trading bloc.
Fund short covering could give added impetus to the rebound from a 7-1/2 month low of 11.36 cents set on May 21.
"The funds net short has now broken its record from last year and the fundamentals are shifting incrementally in a bullish direction," broker Marex Spectron said in a report.
Speculators sharply increased their net short position in raw sugar on ICE Futures US in the week to May 21, US government data showed on Friday.
"The 12 cent barrier will have to be breached first before we see any signs of a short covering rally by the speculative community," Sucden Financial senior trader Nick Penney said.
August white sugar was down $1.00, or 0.3pc , at $323.40 a tonne.
COCOA
July London cocoa fell 9 pounds, or 0.25, to 1,780 pounds a tonne.
July New York cocoa was down $18, or 0.7 percent, at $2,449 a tonne.
Below-average rainfall last week in most of Ivory Coast's cocoa-growing regions could cause the April to September mid-crop to decline in some regions, farmers said.
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