London Cocoa Taps Highest Since 2016, Raw Sugar Jumps

(Reuters) – London cocoa futures on ICE rose on Tuesday to their highest since 2016 on speculative buying and support from the weak British pound, while raw sugar rose for the first time in four sessions as industry participants gathered in New York.

COCOA

July London cocoa settled up 2 pounds, or 0.1 percent, at 1,934 pounds per tonne in light volume after tapping 1,971 pounds, the highest for the second position since November 2016.

The London market, which was shut for a holiday on Monday, was catching up with gains in New York in the previous session and was also supported by the weak British pound against the U.S. dollar, traders said.

Sentiment remained positive amid signs speculators are still broadly bullish towards the commodity, after data last week showed funds slightly boosted their long position in London while only lightly trimming their New York bet, dealers said.

“One outweighed the other,” said one dealer. “Ultimately, you’ve got a speculator position that’s remained at a healthy long.”

July New York cocoa settled down $75, or 2.6 percent, at $2,773 per tonne, giving up the prior session’s gains.

The dollar-traded market was pressured by the stronger U.S. dollar index that hit a 2018 peak on Tuesday.

SUGAR

July raw sugar settled up 0.24 cent, or 2.1 percent, at 11.56 cents per lb.

Largely bearish forecasts for global supply were being stated by members of the sugar industry as they gathered in New York for what is called “Sugar Week.”

Sugar output in Brazil’s center-south will fall 14 percent from the prior season to a nine-year low, commodity brokerage INTL FC Stone said, amid a glut of production in key producers including India and Thailand.

World sugar production will outstrip demand by 12.59 million tonnes in 2018-19 to the largest single-year surplus since at least 2006-07, according to an industry presentation from sugar analysts at S&P Global Platts/Kingsman.

August white sugar settled up $6.50, or 2 percent, at $327.60 per tonne.

COFFEE

July arabica coffee settled down 1.15 cents, or 1 percent, at $1.196 per lb. July robusta coffee settled down $19, or 1.1 percent, at $1,794 per tonne.

Certified robusta stocks dwindled to their lowest in more than 3-1/2 years last week, after bargain-hunting buyers scooped up deeply discounted beans.