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Sugar eases as Brazil harvest gathers pace

Sugar futures on ICE dipped on Friday, consolidating after favourable cane harvesting weather in Brazil prompted a sell-off in the previous session, while sterling weakness helped London cocoa to a 39-year.
Arabica coffee futures inched higher, supported by concerns over the quality of new-crop Brazilian beans, while robusta coffee firmed, underpinned by tight global stocks.
Sugar futures eased, pressured by a rapid cane crush in centre-south Brazil.
“The weather in Brazil looks quite dry. Everything looks very positive for the harvest,” said Carlos Mera, a senior
Rabobank commodities analyst.
“Funds are very long in this market. There is a huge potential for profit-taking.” October raw sugar was down 0.1 cent, or 0.5 percent, at 19.63 cents per lb at 1137 GMT.
October white sugar fell $1.70, or 0.3 percent, to $541.90 a tonne, with traders turning their attention to the
expiry of the August contract on July 15.
Sterling-based London September cocoa was down 7 pounds, or 0.3 percent, at 2,506 pounds a tonne, having touched 2,518 pounds, the highest level since September 1977.
The contract has been supported by a slide in the pound to near a 31-year low after Britain’s vote to leave the EU.
Sterling-based London cocoa positions are cheaper for holders of alternative currencies.
Dealers referred to concerns over poor West African mid-crops but said the outlook for the coming main crops
appeared rosier.
“We expect a good pick-up of arrivals early next season (October),” Mera said.
New York September cocoa was up $3, or 0.1 percent, at $3,113 a tonne.
Coffee futures hovered near multi-month highs, underpinned by concerns over tight supplies.
Traders referred to a slow flow of robusta exports from Indonesia after the El Nino weather pattern eroded production there.
A very poor robusta harvest in Brazil underpinned a 1.1 percent gain for September robusta coffee, up $19 at
$1,781 a tonne.
September arabica coffee was up 0.95 cents, or 0.7 percent, at $1.4275 per lb.

(Reuters)

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