LONDON: Arabica coffee futures rose on Monday, boosted partly by concern that cold weather in Brazil could damage crops while potential tariffs on U.S. imports from the world’s top grower were also in focus.
Coffee
Arabica coffee was up 2.6% at $3.0520 per lb by 1141 GMT.
Dealers said a drop in temperatures in parts of Brazil’s coffee belt had raised crop concerns while the market also considered the potential imposition on Friday of a 50% tariff on shipments from Brazil to the United States.
Dealers said the tariff could bring the flow of coffee from Brazil to the U.S. to a halt, forcing U.S. coffee manufacturers to source more expensive supplies from Colombia, Central America and East Africa.
Brazilian exporters would also need to find a new home for the roughly 8 million bags of arabica coffee they ship to the U.S. every year.
Robusta coffee rose 3% to $3,293 a metric ton, regaining ground after touching a 16-month low of $3,166 last week.
Dealers said the recent decline in robusta prices had been driven by plentiful supplies as harvests in Indonesia and Brazil progress well and a generally favourable outlook for crops in top robusta producer Vietnam.
Speculators increased a net short position in robusta coffee by 3,334 lots to 4,628 lots as of July 22.
Coffee prices edge higher but overall sentiment bearish
Sugar
Raw sugar gained 0.7% to 16.40 cents per lb.
Dealers said supportive factors included lower than expected ATR (total recoverable sugar) from the cane harvest in Centre-South Brazil and signs of a pick-up in demand, with Pakistan among those seeking supplies recently.
White sugar rose 0.4% to $473.00 a ton.
Cocoa
London cocoa lost 0.6% to 5,268 pounds a ton.
New York cocoa was down 0.65% at $8,275 a ton.