LONDON: Raw sugar futures on ICE rose on Friday, boosted by more upbeat chart signals despite worries about ample supplies, while London cocoa gave up some of the prior session’s gains as speculative selling remained in focus.
SUGAR
* October raw sugar was up 0.15 cent, or 1.4 percent, at 10.74 cents per lb by 1140 GMT.
* This extended gains from the prior session, when prices rebounded sharply from three-year lows as speculators covered short positions.
* Dealers said the market remained technically oversold on Friday, which was helping to discourage fund selling and attract some further chart-driven buying.
* They also noted sentiment had been boosted this week after the October position’s deep discount to the March contract attracted solid spot buying by refiners, eventually triggering a sharp and sudden narrowing in the spread.
* This demand from refiners was seen as supportive, although dealers were cautious on whether there would be further substantial buying going forward, as a backdrop of ample global supplies remains in focus.
* “The more immediate worry though is just how much sugar traders and refiners are willing to take on at these prices and spreads,” said Tobin Gorey of the Commonwealth Bank of Australia in a market note. “Sugar inventories will swell mightily into 2019.”
* Brazil’s centre-south region is seen crushing 549 million tonnes of cane this season, with sugar output at 27 million tonnes, down from a prior forecast of 30 million tonnes, a consultancy said on Thursday.
* Brazilian cane mills will continue to prioritize ethanol production over sugar output well into the next crop season as high oil prices boost demand for the biofuel, millers and consultants said.
* October white sugar was up $2.40, or 0.8 percent, at $320.70 a tonne.
COCOA
* December London cocoa was down 11 pounds, or 0.7 percent, at 1,591 pounds a tonne.
* On Thursday, prices rebounded after matching the previous session’s five-month low of 1,580 pounds.
* Dealers noted speculators were still seen as eager to sell, although the downside was limited by technical support around the lows hit in the prior session.
* September New York cocoa was up $7, or 0.3 percent, at $2,079 a tonne.
COFFEE
* September robusta coffee rose $7, or 0.4 percent, to $1,651 a tonne.
* Prices climbed to a session high of $1,664 in early trading, although volumes and buying interest were thin.
* September arabica coffee rose 0.45 cent, or 0.4 percent, to $1.0715 per lb.
Source: Brecorder
