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Markets

Robusta coffee sinks to two-year lows, raw sugar rises

Published Updated

COFFEE

* May robusta coffee settled down $5, or 0.3 percent, at $1,485 per tonne, after hitting $1,463, the lowest for the second month since March 2016.

* Prices are pressured by plentiful global supplies and are now playing catch-up to arabica, dealers said.

* "We've been under-hedged in robusta between Brazil, Vietnam, and Indonesia," said one US trader. "So that will keep a lid on."

* A large Brazilian conilon robusta crop was also pressuring the market, dealers said.

* On the week, the contract shed 2.9 percent, its worst weekly performance in 3 months.

* Vietnam coffee prices fell this week, while there was a build-up of supply and muted trade in Indonesia.

* May arabica coffee settled up 0.65 cent, or 0.7 percent, at 97.80 cents per lb. On Tuesday, prices hit a 13-year low of 94.65 cents.

* "We've made a new low and the market is having a hard time sustaining gains," said Rodrigo Costa, director of trading at Comexim USA.

* On the week, the contract lost 0.9 percent, its sixth negative weekly finish in seven.

SUGAR

* May raw sugar settled up 0.11 cent, or 0.9 percent, at 12.52 cents per lb. In the prior session, the contract hit a one-week high of 12.69.

* On the week, the contract gained 2.8 percent as prices rose after hitting a one-month low of 12.08 cents the previous week.

* Still, the contract has been largely range-bound, trading between the 12 and 13 cent levels for most of 2019.

* "It's just fairly priced here," said Shawn Hackett, president of Hackett Financial Advisors.

* Brazil's 2019-20 center-south cane crop that starts in April is likely to exceed the current season's, the first increase from one crop to another since 2015-16, Agroconsult data showed.

* Elsewhere, however, supply concerns could emerge. French sugar trader Sucres et Denrees SA, or Sucden, expects a larger deficit in the world's sugar supply balance in the 2019-20 crop year, at around 4 million tonnes, due to projected decreases in output in India, Thailand and the European Union.

* May white sugar settled up $1.90, or 0.6 percent, at $340.7 per tonne.

COCOA

* May New York cocoa settled down $17, or 0.8 percent, at $2,197 per tonne. On the week, the contract fell 0.9 percent.

* May London cocoa settled down 25 pounds, or 1.5 percent, at 1,656 pounds per tonne.

Copyright Reuters, 2019