(Reuters) – Cocoa futures on ICE fell to three-month lows on Thursday on pressure from resales of beans in Ivory Coast and a stronger dollar, while raw sugar and arabica coffee edged higher on chart-based buying.
Dealers noted concern about overall commodity demand in China after it allowed its currency to lose value.
Cocoa futures extended losses on pressure from the reselling at a discount of about 200,000 tonnes of 2015/16 beans purchased by domestic operators in Ivory Coast, the world’s biggest producer.
“The reselling is weighing on both markets (London and New York),” a senior London-based cocoa futures broker said.
“The market will find it hard to bounce.”
December cocoa in New York was down $11, or 0.4 percent, at $3,041 per tonne at 1053 GMT, after touching $3,034, the lowest since mid-May.
In London, December cocoa eased by 12 pounds, or 0.6 percent, to 2,023 pounds, having fallen to 2,021 pounds, the lowest since mid-May.
Raw sugar futures edged higher, drifting further away from Monday’s seven-year low, in a technical correction after several sessions of falling prices, with upside in prices capped by plentiful supplies.
October raw sugar on ICE traded up 0.06 cent per lb, or 0.6 percent, at 10.60 cents.
The sugar market continued to track fluctuations in the Brazilian real, which has fallen against the dollar in recent months, boosting incentives for Brazilian producers to sell their sugar to lock in local currency returns.
“At 4.0 reais to the dollar, we could witness a single digit New York price,” ED&F Man said in a research note.
The real is currently trading at around 3.5 to the dollar.
October white sugar was up $1.60, or 0.5 percent, at $351.70 a tonne.
Arabica coffee held steady, having tumbled 4 percent in a late-day selling spree on Wednesday after touching a three-month high.
December arabica coffee traded up 0.95 cents, or 0.7 percent, at $1.3620 per lb, having on Wednesday touched a three-month peak of $1.4115 per lb.
“Provided futures can post successive gains and post a close back above $1.40 per lb, we could see resistance towards $1.43 targeted on any improvement in trading volumes and momentum,” said Kash Kamal, senior research analyst with Sucden Financial.
September robusta coffee was down $19, or 1.1 percent, at $1,680 a tonne.
