LONDON: Raw sugar futures on ICE rose to a three-week high on Wednesday, boosted by further gains in energy markets, while cocoa prices also climbed.
SUGAR
Raw sugar rose 1.8 percent to 14.36 cents per lb as of 1211 GMT, having hit its highest since April 8 at 14.39 cents. Oil prices rose 3percent on Wednesday, with the Brent contract hitting a one-month high, on media reports the US will extend its blockade of Iranian ports, likely prolonging supply disruptions in the key Middle East producing region.
Higher energy prices can lead to more use of cane to produce biofuel ethanol and therefore reduce sugar production. Sugar production in Brazil’s key center-south region in the first half of April is expected to have fallen 26.4 percent to 541,000 metric tons versus the year-ago period, a survey of analysts from S&P Global Commodity Insights showed on Tuesday.
The survey, however, indicated that both cane and ethanol output is expected to have risen. White sugar gained 0.8percent to USD436.50 a metric ton.
COCOA
London cocoa rose 0.6percent to 2,554 pounds a ton. Dealers said concerns remained that a shortage of fertilizers could adversely impact global production in the 2026/27 season. There are also early signs that demand may be beginning to recover after falling in 2025. Oreo-maker Mondelez International beat Wall Street estimates for first-quarter revenue and profit on Tuesday, helped by resilient demand for its chocolates and biscuits along with higher prices. New York cocoa gained 1.2percent to USD3,422 a ton.
COFFEE
Arabica coffee fell 0.2percent to USD2.9015 per lb. Dealers said the arabica harvest in top producer Brazil should start to gather pace next month and generally dry weather is expected to aid early progress.
Robusta coffee lost 1.3 percent to USD3,437 a ton. Starbucks beat Wall Street estimates for quarterly comparable sales on Tuesday, saying investments in faster service and improved staffing under CEO Brian Niccol’s efforts to turn around the coffee chain pulled in more customers.