Liffe July robusta coffee rose $67 to close at $2,502 a tonne on Tuesday after setting a contract high of $2,549. Market bolstered by renewed strength in ICE arabicas, which surged back up towards a recent 34-year peak. Liffe August white sugar fell $6.00 to close at $633.10 a tonne. Market weighed by expectations of ample production from Brazil and Thailand and the possibility of further unrestricted exports from India.
Liffe July cocoa ended 17 pounds higher at 1,907 pounds a tonne. Traders monitoring situation in top grower Ivory Coast where the cocoa sector set to resume operations within days following a violent post-election conflict. "Coffee could bounce a little higher today. We're getting buying interest from specs," said one veteran London-based coffee futures dealer. Robusta coffee futures appeared to be consolidating after rising last week when ICE arabicas set the high.
"Robustas got dragged back up by New York last week and it seems to be fizzling out a little bit now," one dealer said. Dealers said the market continued to keep a close watch on the May/July spread with the open interest on the front month still at a comparatively high 27,602 lots just one week before first notice day. The spread, which was trading at a backwardation of more than $100 earlier this month, has now moved to a contango of around $25, lessening concern about a potential squeeze.
"You are going to see positions getting gradually wound down over the next couple of days and we will see what we are left with on Tuesday (May 3)," one dealer said. Vietnam's April coffee exports jumped an estimated 30.3 percent from the same month in 2010 to 155,000 tonnes, or 2.58 million bags, exceeding market expectations, the agriculture ministry said.