Friday, 21 August 2015 03:03
NEW YORK/LONDON: White sugar futures dropped for the fourth straight session to a 6-1/2-year low on Thursday as refiners sold into the whites-over-raws premium, while spot arabica coffee fell in heavy volume ahead of first notice day on Friday.
Cocoa futures edged up on technically driven buying.
White sugar prices fell sharply as refiners locked in sales before the steep premium over raw sugar prices dissolved, traders said.
October white sugar settled down $ 5.60, or 1.7 percent, at $ 333.60 a tonne, after touching a 6-1/2-year low of $ 329.00.
The premium of white sugar over raw sugar rose to more than $ 120 per tonne on Aug. 11, prompting refineries to sell and pushing the price of whites lower, brokers said.
“The premium jumped up, then the refineries sold and the market collapsed,” one broker said, referring to heavy selling of the whites this week and the October whites premium falling back below $ 100 per tonne on Thursday for the first time in three weeks.
Another broker said: “Refiners have taken advantage of the recent strength in the premium so high quality whites availability should increase,” the broker added.
Heavy selling briefly brought the October white contract to a discount against December for the first time in five weeks.
October raw sugar futures settled up 0.03 cent, or 0.3 percent, at 10.62 cents a lb, turning higher after falling to a session low of 10.44 cents. This is within sight of an Aug. 10 seven-year trough of 10.37 cents a lb, pressured by huge global stocks.
In coffee, arabica prices fell on heavy selling in the September contract ahead of its first notice day on Friday, traders said, with open interest still heavy at 10,580 lots on Wednesday.
December arabica finished down 2.35 cents, or 1.7 percent, at $ 1.3245 per lb.
The robusta coffee front-month discount grew to the biggest since late-May in a third day of volatile dealings. Dealers are watching it closely after the July contract surged unexpectedly to a steep premium ahead of its delivery.
September robusta coffee closed down $ 30, or 1.8 percent, at $ 1,639 per tonne.
New York and London cocoa markets extended gains above 100-day moving averages, and were underpinned by concerns over dryness in parts of top growers Ivory Coast and Ghana.
New York December cocoa ended up $ 19, or 0.6 percent, at $ 3,135 a tonne, while London December cocoa closed up 7 pounds, or 0.3 percent, at 2,082 pounds.
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