LONDON: Sugar futures on ICE slipped in thin trade on Thursday, weighed by weakening chart signals and persistent worries about a global supply glut, while robusta coffee fell to a three-week low.
SUGAR
July raw sugar was down 0.03 cents, or 0.3 percent, to 11.26 cents per lb by 1103 GMT.
This extended losses from the previous session, when a breach in technical support inspired speculative short-selling, dealers said.
They noted the weak close weakened the structure and reinforced negative sentiment on Thursday.
Focus this week has been on an industry gathering in New York, where some participants have forecast lower output from top grower Brazil.
However, a giant Indian crop is expected to more than compensate for the lowest output in a decade from central Brazil, putting the market on course for two years of record oversupply.
Market participants were awaiting cane crush data for Brazil’s Centre-South region, expected on Thursday, for fresh indications of output.
August white sugar fell $1.20, or 0.4 percent, to$322.70 a tonne.
The premium for white sugar over its raw equivalent has recovered to around $70 per tonne recently.
“Those levels might interest some Thai millers but are unlikely to be high enough for most standalone refineries,” Tobin Gorey of the Commonwealth Bank of Australia said in a note.
The world’s top sugar exporters have initiated a legal review of government supports in the European Union, India and Pakistan that may violate World Trade Organization restrictions on direct subsidies.
China’s sugar supply deficit is poised to shrink in the 2018/19 season, with farmers expected to boost output due to higher prices.
Wilmar International Ltd posted a 40.6 percent fall in its first-quarter net profit on Thursday, partly citing seasonal losses in its sugar business.
COFFEE
July robusta coffee fell $4, or 0.2 percent, to$1,743 a tonne, after touching a three-week low of $1,728.
This extended deep losses from the prior session. Prices have sold off this week, weighed by a wave of producer hedging and follow-through selling.
July arabica coffee rose 0.05 cents, or 0.04 percent, to $1.1880 per lb, but hovered near lows touched on Wednesday.
The Brazilian real remained in focus, dealers said, as it has weakened sharply this week.
COCOA
July New York cocoa rose $6, or 0.2 percent, to$2,776 a tonne.
July London cocoa was unchanged at 1,924 pounds a tonne.
Source: Brecorder
