LONDON: Robusta coffee futures on ICE fell on Monday, with the harvest in top producer Vietnam set to gather pace shortly, while sugar prices also weakened.
COFFEE
* January robusta coffee fell $37, or 2.1 percent, to $1,692 a tonne by 1432 GMT.
* Dealers said the prospect of a large crop in Vietnam, where the harvest is expected to be in full swing in the second half of November, had brought an end to the recent rebound in prices.
* “I don’t see much room for further extension of this recovery because the market is still amply supplied, especially with Vietnam bound to start harvesting a bumper crop,” said one European dealer.
* They noted speculators have also now largely covered a net short position after six consecutive weekly declines which has seen it fall to just 4,786 lots, as of Oct. 30, from 35,465 lots on Sept. 18.
* December arabica coffee slipped 1.75 cents, or 1.5 percent, to $1.1830 per lb, pressured by a weaker Brazil real .
* A weaker real weighs on prices because it increases local currency returns on dollar-traded commodities such as coffee and sugar, encouraging Brazilian producers to sell.
SUGAR
* March raw sugar was down 0.20 cents, or 1.5 percent, at 13.24 cents per lb.
* Dealers said there was a slowdown in speculative activity as funds took a breather from buying.
* Speculators switched to a net long position in raw sugar for the first time in 11 months on ICE Futures US in the week to Oct. 30, government data showed on Friday.
* Participants were also closely monitoring crop conditions in key producers such as Brazil, India, Thailand and the European Union.
* Commodity broker Marex Spectron switched its 2018/19 global sugar balance outlook to a small deficit, saying that low prices, unfavourable weather and a focus on ethanol could lead to another shortfall in 2019/20.
* Analyst Green Pool, however, argued that production is unlikely to drop dramatically in the likes of India, where farmers have increased the planted area this season. “It seems that a very sharp drop in yields would be needed to offset that rise in area,” Green Pool said in a market update.
* December white sugar was down $6.70, or 1.9 percent, at $351 a tonne.
COCOA
* December London cocoa rose 8 pounds, or 0.5 percent, to 1,683 pounds a tonne.
* December New York cocoa climbed $16, or 0.7 percent, to $2,283 a tonne.
* Sunny spells and scarce rainfall in most of Ivory Coast’s cocoa growing regions last week could stem the spread of black pod disease and boost the main cocoa crop, farmers said on Monday.
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Source: Brecorder
