Cocoa extends advance, raw sugar drifts lower

COCOA

July London cocoa had risen 6 pounds, or 0.38 percent, to 1,588 pounds a tonne by 1056 GMT, extending the prior session's advance which saw prices climb by 5.82 percent.

"There has been some very light follow-through buying and the currency has had a bit of a change here," one dealer said, adding a weak pound helped to support London prices.

Dealers said the run-up had been driven by fund short covering which had been met with trade selling.

"We have to hold onto yesterday's gains to convincingly say this has been a short-term change of direction," one dealer said, noting the market had clawed back all of the losses it made during last week's steep fall.

July New York cocoa was up $5, or 0.25 percent, at $2,042 a tonne.

SUGAR

July raw sugar fell 0.10 cents, or 0.67 percent, to 14.92 cents per lb, drifting down towards a 13-month low of 14.73 cents set on Tuesday.

Dealers said bearish factors included an improving outlook for production in India and a recent drop in gasoline and diesel prices in Brazil which boosts the incentive for using cane to make sugar rather than ethanol.

India's 2017/18 sugar production will likely jump a quarter from the previous year to 25 million tonnes as decent monsoon rains are forecast, the head of an industry body told Reuters.

"There may be a short term bounce as the markets are oversold but the long term picture continues to point to lower levels and a test of the ethanol parity now reckoned to be below 14 cents," said Sucden Financial senior trader Nick Penney.

Egypt's state buyer, the General Authority for Supply Commodities (GASC), bought 50,000 tonnes of raw sugar in a direct purchase outside the tender process, Cairo-based traders said on Tuesday.

August white sugar fell by $3.60, or 0.82 percent, to $434.80 a tonne.

COFFEE

July robusta coffee was up $9, or 0.45 percent, at $2,019 a tonne, edging up towards Tuesday's three-week high of $2,025, supported by technically-driven buying.

July arabica rose 1.0 cent, or 0.76 percent, to $1.3310 per lb.