LONDON: Robusta coffee futures hit a two-month peak on Tuesday, buoyed by a lack of producer selling, while raw sugar dipped as the market readjusted after the US Presidents Day holiday.
Arabica coffee futures firmed on light chart-based buying, with dealers focused on prospects for 2015/16 production, and cocoa was little changed.
May robusta coffee futures touched $ 2,077 per tonne, the highest level since Dec. 2, before losing some ground to trade at $ 2,055 per tonne, down $ 11 or 0.5 percent at 1220 GMT.
“Farmers in (top grower) Vietnam have been fairly slow in selling the crop,” said Carlos Mera, an analyst with Rabobank. He said well-financed Vietnamese growers had been disappointed by weak prices in December and had held onto stocks.
The current Tet Lunar New Year holidays diminished selling pressure too.
Recent dry weather in conillon (robusta) growing areas of Espirito Santo in southeastern Brazil eroded output prospects there, Mera said.
ICE raw sugar futures dipped as the market readjusted after the US Presidents Day holiday, and dealers expected light trading volumes due to the Carnival in top exporter Brazil.
“With Carnival being celebrated today and the Chinese Lunar New Year holidays about to begin, the only thing that might create further activity is tonight’s March option expiry in New York with the 15 cent strike being the ‘battleground,'” said Nick Penney, senior trader with Sucden Financial Sugar. ICE March raw sugar futures were down 0.13 cent or 0.9 percent to 14.75 cents a lb.
May white sugar was down $ 3.20 or 0.8 percent to $ 387.80 per tonne.
Arabica coffee futures edged up, with the trade focused on the impact of a drought last year on 2015/16 output in Brazil. Cocoa futures were little changed, underpinned by concerns over output in No. 2 grower Ghana. ICE May cocoa futures were up $ 3 or 0.1 percent to $ 2,934 per tonne.
London May cocoa was up 16 pounds or 0.8 percent to 1,993 pounds per tonne. “Short-term indicators suggest the potential for subsequent gains towards the key level of 2,000 pounds and January’s high at 2,028 pounds,” said Myrto Sokou, senior research analyst with Sucden Financial.