Thursday, 12 March 2015 20:30
LONDON: Robusta coffee futures dipped to a 13-month low on Thursday, pressured by expectations for a big 2015/16 Vietnamese crop, while raw sugar steadied near the lowest levels in six years.
Cocoa was little changed, underpinned by concerns over output in Ghana, the second-biggest grower.
May robusta coffee was down $ 35, or 1.9 percent, at $ 1,785 a tonne at 1429 GMT, after touching $ 1,781, the lowest level since February 2014, on the outlook for top grower Vietnam. Higher-than-expected exports of Brazilian conillon in early March also weighed on robusta futures prices.
“The markets had been expecting a reduction in conillon exports,” said Carlos Mera, senior commodity analyst with Rabobank.
“A continuation of selling pressure in breach of support now around $ 1,800 could see futures target levels towards $ 1,775 a tonne,” said Kash Kamal, a senior research analyst with Sucden Financial.
Arabica coffee futures edged up, supported by a softer dollar, but remained within sight of a 13-month low of $ 1.288 per lb touched on March 3.
May arabica coffee futures were up 0.05 cents, or 0.04 percent, at $ 1.3180 per lb.
Raw sugar futures steadied, and risked further falls if the Brazilian real weakened further against the dollar, dealers said.
A weak real helps Brazilian producers to make a profit on sales of dollar-denominated sugar and coffee.
Dealers noted ample availability of raw sugar, with cash values trading at a discount to levels at the recent expiry of the ICE March raw sugar futures contract.
They spoke of strong white-over-raws premiums, buoyed by recent brisk demand from China for refined sugar.
Front-month May raw sugar futures were up 0.11 cent, or 0.8 percent, at 13.25 cents a lb, having dipped on Wednesday to 12.97 cents, the lowest for the spot contract since April 2009.
“Technically, the market is still very much in a downtrend,” said Nick Penney, a senior trader with Sucden Financial Sugar. May white sugar traded up $ 0.10, or 0.03 percent, at $ 371.90 a tonne.
New York May cocoa eased $ 25, or 0.9 percent, to $ 2,830 a tonne.
May London cocoa was down 6 pounds, or 0.3 percent, at 1,974 pounds a tonne.
Copyright Reuters, 2015
