Friday, 20 March 2015 01:44
NEW YORK/LONDON: Arabica coffee futures hit a three-week high on Thursday as a recent rebound gathered momentum as market focus turned to potential crop losses in Brazil, while New York cocoa hit a more than six-week low on continued fund liquidation.
Raw sugar on ICE Futures US fell for the third straight session as the real currency in top producer Brazil continued to slide.
May arabica coffee futures on ICE settled up 4.10 cents, or 2.9 percent, at $ 1.4415 per lb, after earlier rising as high as $ 1.4675, the second-month’s highest level since Feb. 25.
The gains came on concerns about production in drought-damaged coffee areas in Brazil and marked a continued correction upward from last Friday’s low of $ 1.2875 a lb, US coffee traders said. Dealers added that Brazilian producers have been reluctant to sell after the recent slide in prices, providing additional support to the market.
Production of arabica beans from trees in the vicinity of Brazil’s Cooxupe, the world’s largest coffee cooperative, is forecast at 4.6 million bags, unchanged from the drought-ravaged crop in 2014.
May robusta coffee futures dropped $ 4, or 0.2 percent, to settle at $ 1,815 a tonne.
New York May cocoa fell $ 43, or 1.6 percent, to settle at $ 2,715 a tonne, after falling as low as $ 2,705, its lowest level since Feb. 3, as funds continued liquidating amid weak demand and improving crop weather in West Africa. “These trend-following guys are selling right now at the new low,” said Nick Gentile, managing partner at commodity trading advisor NickJen Capital in New York.
Abundant rainfall last week in most of Ivory Coast’s main cocoa growing regions is a positive sign for the April-to-September mid-crop, farmers said this week.
May London cocoa settled down 26 pounds, or 1.3 percent, at 1,923 pounds a tonne after touching 1,919 pounds, the weakest level for the front month since Feb. 5.
May raw sugar futures fell 0.11 cent, or 0.9 percent, to settle at 12.62 cents a lb, pressured by a drop in Brazil’s real currency to its weakest level in nearly 12 years, Gentile said.
The weaker real boosts local currency returns for dollar-traded commodities like sugar, encouraging selling. May white sugar futures fell $ 2.20, or 0.6 percent, settling at $ 363.70 a tonne.
Copyright Reuters, 2015
