Arabica coffee futures on ICE hit a three-month high on Friday as investors covered short positions and on worries about slow harvesting and small bean sizes in Brazil. Raw sugar edged higher in a technical correction, drifting further away from Monday's seven-year low, while New York cocoa was little changed in light volumes, within sight of Thursday's three-month lows.
Second-month arabica coffee traded up 0.5 cents, or 0.4 percent, at $1.4110 per lb at 1435 GMT, having earlier risen to a three-month high of $1.4260 per lb. "The delay in the Brazilian harvest and concerns over the bean sizes, which may be providing some concerns on eventual yield," Kona Haque, head of research at commodities house ED&F Man, said when asked about factors driving up arabica futures. Intelligent Coffee Insights, a research firm co-founded by a former Starbucks executive, has cut its estimate for top producer Brazil's 2015/16 coffee crop to 46.1 million bags, at the low end of market estimates.
September robusta coffee rose $8, or 0.5 percent, to $1,712 a tonne. In raw sugar, benchmark futures prices moved higher on chart-based buying, with plentiful supplies and a weak Brazilian currency capping the upside. October raw sugar rose 0.22 cents a lb, or 2.1 percent, to 10.71 cents but remained within sight of Monday's seven-year low of 10.37 cents.
"The sugar sell-off (this week) has been quite substantial, in line with the weakening real," Haque said. "Also, crushing weather in Brazil has been very favourable." Nick Penney, a senior trader with Sucden Financial Sugar, said: "The Brazil real is attempting to stabilise at around 3.50 against the dollar, but we see this weakening further, adding to the downward pressure in sugar." October white sugar rose $1, or 0.3 percent, to $350.70 a tonne. Cocoa futures hovered near Thursday's three-month low, pressured by the discounted reselling of about 200,000 tonnes of 2015/16 cocoa beans purchased by domestic operators in Ivory Coast, the world's biggest producer. December cocoa in New York was up $4, or 0.1 percent, at $3,065 a tonne, having on Thursday touched its lowest since mid-May at $3,020.