(Reuters) – Arabica coffee futures were slightly lower on Thursday, drifting towards the prior session’s three-week low, weighed down partly by sluggish physical demand.
Raw sugar and cocoa futures crept higher but remained in striking distance of multi-week lows set on Wednesday.
COFFEE
* December arabica coffee fell 0.30 cents, or 0.22 percent, to $1.3420 per lb by 1106 GMT.
* The contract dipped to $1.3360 on Wednesday, the weakest for the second position since July 26.
* Dealers said there was little support, with speculative short-covering largely exhausted. Physical demand also remained sluggish, further weighing on sentiment.
* “We’ve seen some roasters covering a bit on the spots because of the slow shipments that are coming out of Brazil,” said one dealer. “But they’ve mostly got the cover they need to get through.”
* The International Coffee Organization raised its forecast for 2016/17 world coffee production to a record 153.9 million 60-kg bags, up from a previous projection of 151.6 million, mostly due to higher output from Indonesia.
* November robusta coffee also fell $2, or 0.1 percent, to $2,052 per tonne after hitting a 7-1/2 week low on Wednesday.
* Discounts for Vietnamese coffee have tightened in thin trade with few good quality beans available and farmers holding onto their stocks on expectation prices would rise in the coming days, traders said.
SUGAR
* October raw sugar rose 0.08 cent or 0.62 percent to 13.02 cents per lb, edging away from Wednesday’s seven-week low of 12.92 cents.
* Dealers said weak prices had curbed the amount of hedging done by Brazilian mills on raw sugar futures.
* Brazilian mills have hedged around 2.7 million tonnes of the sugar they will produce next year, 15 percent less than the same time a year ago, according to Sao Paulo-based Archer Consultancy.
* October white sugar rose $2.30, or 0.64 percent, to $363.30 a tonne. The front month had slumped to a low of $360.40 on Wednesday, its weakest since September 2015.
COCOA
* December New York cocoa rose $13 or 0.71 percent to $1,852 a tonne. The contract fell to a low of $1,830 on Wednesday, the weakest for the second position since July 13.
* Dealers said the market was technically oversold following the recent decline in prices but the scope for any rebound in prices may be limited by the prospect there may be a second consecutive global surplus in the upcoming 2017/18 season.
* December London cocoa was up 5 pounds or 0.34 percent, at 1,474 pounds a tonne.
