Monday, 20 July 2015 17:54
LONDON: Raw sugar futures fell to a three-week low on technically driven selling on Monday, while robusta coffee held close to the seven-week low hit on Friday under pressure from plentiful supplies.
Cocoa was steady, underpinned by crop concerns over the El Nino weather phenomenon.
October raw sugar dropped 0.18 cents, or 1.5 percent, to 11.78 cents a lb by 1041 GMT, having touched a three-week low of 11.75 cents a lb. October whites eased $ 2.80, or 0.8 percent, to $ 354.60 a tonne.
“For now I feel that the market is heading towards being oversold, though technically on the chart it has not yet quite reached that situation,” one senior London-based broker said.
“I would therefore look for some further support around the previous lows around 11.76 cents a lb down to the contract low at 11.52 cents.”
Sergey Gudoshnikov, a senior economist with the International Sugar Organization (ISO), said that recent strength in the U.S. dollar would boost incentives for export sales by producers of dollar-based sweetener.
Dealers referred to a huge overhang of Thai and Indian sugar stocks.
In coffee, September robustas were down $ 1, or 0.1 percent, at $ 1,674 a tonne after touching $ 1,667 on Friday, the lowest since May 22. September arabicas eased 0.25 cents, or 0.2 percent, to $ 1.2815 per lb.
“There are no nearby bullish arguments for robusta and arabica,” one coffee dealer said, referring to plentiful overall availability of coffee.
Cocoa futures steadied after data late on Thursday showed that processing in North America was at the low end of expectations.
December London cocoa was up 3 pounds, or 0.1 percent, at 2,217 pounds a tonne, while September New York cocoa slipped by $ 3, or 0.1 percent, to $ 3,343 a tonne.
Both contracts rose to their highest levels since March 2011 on Wednesday on speculative buying and the concerns over the potential production impact of El Nino.