NEW YORK/LONDON: Coffee futures on ICE rose on Tuesday, largely erasing the previous session’s losses on short covering, traders said, while cocoa slipped as dealers awaited further indications on the quality and quantity of the main crop in West Africa.
COFFEE
December arabica coffee settled up 3.45 cent, or 2.9 percent, at $1.211 per lb.
Arabica recovered after losing 3.6 percent on Monday, its worst day in over two months.
Prices rose on short covering, dealers said, and climbed despite weakness in the currency of top grower Brazil. A weaker currency can encourage producer selling.
Total open interest fell for the 17th straight session to 285,967 lots, the lowest since July 2, ICE data show.
The contract settled above the 200-day moving average, a bullish signal, and its fourth settle above that level in the past five sessions.
January robusta coffee settled down $2, or 0.1 percent, at $1,719 per tonne.
COCOA
December New York cocoa settled down $33, or 1.5 percent, at $2,187 per tonne, shedding much of the prior session’s advances.
Trading was choppy as the market tracked the harvest in West Africa, the main growing region. Dealers kept a close eye on arrivals of cocoa into Ivory Coast ports, which have so far been higher than last year.
“Until the cocoa arrivals tail off six weeks from now, we’re going to be in a trading range, we’re going to chop around,” said one US trader.
Still, there were some concerns over quality as farmers in eastern Ivory Coast said that above-average rainfall could hinder bean-drying and fuel the spread of disease.
December London cocoa settled down $12, or 0.7 percent, at 1,629 pounds per tonne.
SUGAR
March raw sugar settled down 0.01 cent, or 0.1 percent, at 13.81 cents per lb. This was the second straight negative finish, following the contract’s 6.3 percent rise last week.
Prices encountered technical resistance at 14 cents, dealers said.
“The question remains whether the bulls can summon sufficient momentum to break through to new highs and trigger the next round of buying,” James Liddiard, senior vice president at consultancy Agrilion, said in a note.
Diminished production outlooks in Brazil, the European Union and potentially India have contributed to the recent price advance, as have gains in the Brazilian currency.
Sao Paulo-based consultancy Datagro foresees a 2018/19 global supply deficit, after earlier forecasting a surplus.
December white sugar settled up $3.50, or 0.9 percent, at $380.50 per tonne.
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Source: Brecorder
