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Arabica coffee extends gains on tight nearby supplies

LONDON: Arabica coffee futures on ICE rose for a second straight day on Thursday as the market remained buoyed by tight nearby supplies, while raw sugar prices fell as the energy market weakened.

COFFEE

September arabica coffee ended 2.2% higher at $2.1930 per lb.

ICE-certified stocks continued their relentless decline. They were last at 695,135 60kg bags, their lowest in more than 20 years.

Dealers were also eyeing sharp output falls in key washed arabica producers Honduras and Colombia.

Looking ahead, Rabobank warned that if the weather outlook in top producer Brazil is good as of mid-August, arabica will face some pressure as the frost risk premium will disappear.

November robusta coffee rose 0.9% to $2,041 a tonne.

Coffee prices in Vietnam, the world’s top robusta producer, hovered near a four-year high this week due to a stronger US dollar and no stocks at the end of the crop season, traders said.

SUGAR

October raw sugar ended 1.2% lower at 17.55 cents per lb, slipping back towards a one-year low of 17.20 cents touched on Monday.

Dealers said a decline in crude oil prices on Thursday helped to exert downward pressure on prices.

Lower energy prices make it less lucrative to use cane to produce biofuel ethanol, potentially increasing the supply of cane available for making sugar.

France’s largest sugar group Tereos said on Thursday it currently expects yields in this year’s French sugar beet harvest to top the five-year average despite a lack of rainfall.

October white sugar rose 0.1% to $528 a tonne.

COCOA

December New York cocoa rose 2.2% to $2,388 a tonne.

December London cocoa was little changed, edging up 1.6% to 1,780 pounds per tonne.

Arabica coffee extends gains on tight nearby supplies

Source: Brecorder

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