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Tuesday, 07 July 2015 16:46
LONDON: Robusta coffee futures held steady on Tuesday, with traders focused on a high front-month spread, while sugar dipped before the release of Brazilian crop data expected to show a brisk cane harvest.
New York cocoa edged lower, pressured by a stronger dollar and expectations of weak European demand data next week.
The July/September spread on Robusta coffee was hovering at around $ 136 a tonne, slightly below Monday’s peak of $ 139.
“We’re on day five of the (July) delivery period. With a high open interest in July that has yet to be delivered, it is not surprising the spread is high,” one senior trader said.
September robusta gained $ 3, or 0.2 percent, to $ 1,714 a tonne by 1118 GMT.
Arabica coffee futures on ICE also edged higher, moving further away from Monday’s 1-1/2 year low, with upside capped by the greenback’s strength, which makes dollar-based positions more expensive in other currencies. September arabica was up 0.4 cents, or 0.3 percent, at $ 1.2555 per lb, above Monday’s low of $ 1.2505.
Raw sugar futures steadied as dealers awaited Brazilian Unica cane industry data expected to show rapid cane harvesting in centre-south Brazil in the second half of June in mainly dry weather.
“The weather was generally better for cane crushing than for the first half of June, so better numbers might be expected — for cane if not necessarily for sugar,” said James Liddiard, of consultancy Agrilion.
“However, the first half of July is experiencing less settled weather.”
October raw sugar futures were down 0.04 cents, or 0.3 percent, at 12.44 cents a lb.
August white sugar futures rose $ 0.40, or 0.1 percent, to $ 376.30 a tonne.
Referring to the expiry of the August contract on July 16, Liddiard said he expects open interest to come down sharply, with the August/October spread becoming more volatile at times.
Cocoa futures eased slightly ahead of quarterly cocoa grind data, a measure of demand, due next week.
So far, weak demand has dealers expecting lower grind data.
September London cocoa was up 5 pounds, or 0.2 percent, at 2,176 pounds a tonne and September New York cocoa traded down $ 18, or 0.6 percent, at $ 3,260 a tonne.
