Raw sugar slips from nine-month peak, cocoa down


raw sugar futures were lower on Monday, retreating from the prior session’s nine-month high, while New York fell to a three-week low. March raw sugar was down 0.09 cents, or 0.7%, at 12.85 cents per lb at 1509 GMT. The front month rose to a peak of 13.01 cents on Friday, its highest since Feb. 26.
Dealers said funds had been scaling back a large net short position, while producer selling had helped to limit gains. A bullish technical outlook following the market’s recent strong performance could, however, prompt producers and the sugar to hold off selling and let fund buying come to them, broker Marex Spectron said in a report.
“We may find ourselves testing just how strong the famous ‘wall of selling’ is,” Marex said. Weekly position data has been delayed until Monday due to last week’s US Thanksgiving holiday.
The report is expected to show a in the net short position held by speculators to less than 100,000 lots, down from 133,394 lots in the prior report and a peak of 245,634 lots in mid-September. March white sugar rose $0.20, or 0.1%, to $345.10 a tonne.
March New York cocoa was down $29, or 1.1%, at $2,539 a tonne after dipping to a three-week low of $2,530. Dealers said the market was weighed down by technically-driven selling as it extended its retreat from a 1-1/2 year high of $2,692 set in mid-November.
Port arrivals in top grower Ivory Coast continued to run slightly behind last season’s pace. Cocoa arrivals in Ghana are also running marginally behind last year.
The International Cocoa Organization on Friday estimated there was a global deficit of 21,000 tonnes in 2018/19, but has not yet issued its first forecast for the current 2019/20 season. “If demand remains high, which is likely in Asia above all, 2019/20 could also see a deficit,” Commerzbank said in a market note.
March London cocoa fell 19 pounds, or 1.0%, to 1,862 pounds a tonne. March arabica coffee fell 0.20 cents, or 0.2%, to $1.1885 per lb. The second month rose to a peak of $1.1980 on Friday, its highest in more than one year.
Dealers said the market was underpinned by the prospect of a global deficit in the 2019/20 season, while there continued to be concerns that dry conditions could curb Brazil’s 2020/21 crop. March robusta coffee fell $8, or 0.6%, to $1,398 per tonne.
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