Monday, 30 March 2015 19:35
LONDON: Raw sugar on ICE steadied after dipping to its lowest in more than six years on Monday on the back of abundant supplies, while cocoa eased with traders noting a quiet start for new euro-based CME and ICE contracts.
Arabica coffee futures edged down, capped by a firmer dollar against a basket of currencies.
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ICE raw sugar futures steadied, with upside limited by the firm dollar which makes the sweetener more expensive in other currencies, and by ample supplies.
The weak Brazilian real currency has weighed on sugar futures prices by encouraging producers in No. 1 grower Brazil to lock in returns from dollar-denominated sugar sales in local currency.
“This market seems to be battling a reality that the real is very low, and a perception it could fall further,” said Tom McNeill, director of Green Pool Commodities. “At the minute, that seems like the only story in town.”
Raw sugar fell to a session low of 12.00 cents a lb, the lowest since January 2009, and then recovered a little ground to trade at 12.19 cents, up 0.06 cent or 0.5 percent at 1318 GMT.
May white sugar was up $ 1.70 or 0.5 percent at $ 361.70 a tonne, after hitting a contract low of $ 358.50.
Speculators boosted a net short position in raw sugar contracts on ICE Futures U.S. in the week ended March 24 to a near two-year high, as they again upped a bearish bet in arabica coffee, U.S. Commodity Futures Trading Commission data showed on Friday.
Cocoa futures held steady in light volumes, with a quiet start to the new CME and ICE contracts.
Eighty seven lots were traded in the CME contract, in July, December and March 2016 months, as of 1312 GMT, and zero in the ICE euro-based contract.
“The new contracts have been a distraction in trading today. It will be interesting to see if that distraction grows or diminishes,” said Jonathan Parkman, joint head of agriculture at Marex Financial.
New York May cocoa was down $ 12 or 0.4 percent at $ 2,732 a tonne.
London May cocoa edged down 2 pounds, or 0.1 percent, to 1,919 pounds a tonne.
Arabica coffee futures inched down, pressured by the firmer dollar.
May arabica was down 1.05 cents, or 0.8 percent, at $ 1.3710 per lb.
May robusta coffee traded down $ 16, or 0.9 percent, at $ 1,772 a tonne.
Copyright Reuters, 2015
