Softs mixed; sugar re-approaches 4-month high on Brazil drought

(Investing.com) – U.S. soft futures were mixed on Wednesday, with sugar prices  re-approaching a four-month high amid speculation dry weather in Brazil will cut  this year’s cane crop.

The May contract fell 0.34% on Tuesday to settle at $0.1774 a pound.

Sugar prices have been well-supported in recent weeks, with prices advancing  nearly 12% in February, amid concerns over Brazil’s crop.

Brazil is the world’s largest sugar producer and exporter, with the U.S.  Department of Agriculture estimating the nation accounts for nearly 20% of  global production and 39% of global sugar exports.

Meanwhile, Arabica coffee for May delivery was flat to trade $1.8500 a  pound.

Prices of the bean lost 4.14% on Tuesday to settle at $1.8545 a pound, as  investors cashed out of the market to lock in gains from the previous session’s  7% rally which took prices to the highest level since March 2012.

The May coffee contract rallied to $1.9760 a pound on Monday, the most since  March 6, 2012, before settling up 7.29% at $1.9345.

Prices of the bean rallied 30.4% in February as drought conditions in key  coffee-growing regions in Brazil was expected to curb output. Year-to-date,  Arabica coffee is up almost 41%.

Brazil is the world’s largest producer and exporter of Arabica coffee.

Elsewhere, cotton futures for May delivery rose to a session high of $0.8955  a pound, the highest since February 25, before turning lower to trade at $0.8878  a pound, down 0.5%.

The May contract rallied 1.01% on Tuesday to settle at $0.8922 a pound, as  frigid temperature was expected to return across parts of the U.S. Midwest in  the coming days, fueling concerns over crop prospects.