LONDON: Raw sugar futures on ICE rallied on Wednesday after sharp losses in the previous session as the Brazilian currency recovered, while arabica coffee hit a two-month trough.

October raw sugar, which expires on Wednesday, rose 0.45 cents, or 3.5%, to 13.04 cents per lb by 1431 GMT after closing 3.2% down in the previous session.

Sentiment was bearish in wider markets, with equities and oil down ahead of the first US presidential debate and as Covid-19 cases continue to rise.

The real recovered against the dollar, however, deterring Brazilian selling of dollar-priced sugar by lowering returns in local currency terms.

Dealers said the market was vulnerable to further weakness given that the recent strength has been mostly driven by fund buying rather than fundamental factors.

December white sugar rose $7.20, or 1.9%, to $374.20 a tonne.

December arabica coffee dipped 0.1 cents, or 0.09%, to $1.0945 per lb, having touched a two-month low of $1.0830.

Soaring warehouse stocks in Brazil after a huge harvest are weighing on coffee, though reports that the recent rains in the country were below expectations could limit losses going forward.

November robusta coffee fell $21, or 1.6%, to $1,306 a tonne.

Coffee exports from Vietnam, the world's top robusta producer, are expected to drop 1.4% from a year earlier in the first nine months of this year, data showed.

December New York cocoa fell $3, or 0.1%, to $2,582 a tonne.

Ghana's cocoa board (Cocobod) signed a $1.3 billion pre-export finance deal for the 2020/21 cocoa season through a syndicated loan, following reports earlier this year that its usual lenders had declined to underwrite the risk.

December London cocoa fell 17 pounds, or 0.9%, to 1,834 pounds a tonne.