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Markets

Raw sugar futures edge up, arabica coffee slides

Published Updated

SUGAR

* May raw sugar settled up 0.11 cent, or 0.90 percent, at 12.29 cents per lb. The front month dipped to a two-month low of 12.08 cents on Thursday.

* Sugar futures got some support from firmer oil prices, which rose 1 percent on comments from Saudi Energy Minister Khalid al-Falih that an end to OPEC-led supply cuts was unlikely before June.

* Higher oil prices can encourage cane mills in top grower Brazil to produce more ethanol rather than sugar.

* Prices have largely been rangebound for the past few weeks, with producer selling accelerating at 13 cents and support around 12 cents.

* Brazil should seek a tariff-free sugar quota agreement with the United States similar to the tariff-free ethanol quota it offers to US exporters of the biofuel, the new head of Brazil's powerful cane industry group Unica said.

* May white sugar settled up $2, or 0.6 percent, at $340.50 per tonne.

COFFEE

* May arabica coffee settled down 1.3 cent, or 1.3 percent, at 97.20 cents per lb after trading within the previous session's range.

* Prices remain pressured by plentiful global supplies, especially from top grower Brazil.

* Futures fell despite a stronger currency in Brazil. The two have frequently moved in tandem of late, as a stronger currency can discourage producer selling of dollar-denominated commodities like coffee.

* Speculators raised their net short position in ICE arabica coffee to the largest since mid-October in the week to March 5.

* "Speculative sentiment remains at low but not extreme levels, meaning prices have the potential to head even lower (over the coming weeks)," ratings agency Fitch said.

* Americans are consuming more gourmet coffee than ever, but the outlook for future growth may be threatened by increasing economic worries.

* May robusta coffee settled up $2, or 0.1 percent, at $1,532 per tonne.

COCOA

* May New York cocoa settled up $4, or 0.2 percent, at $2,202 per tonne, pulling away from last week's 2-1/2 month low.

* May London cocoa settled down 5 pounds, or 0.3 percent, at 1,666 pounds per tonne.

* Cocoa arrivals at ports in top grower Ivory Coast reached 1.587 million tonnes between Oct. 1 and March 10, exporters estimated on Monday, up about 10 percent year on year.

* Below average rainfall in Ivory Coast has raised concerns about the April-to-September mid-crop.

Copyright Reuters, 2019