(Reuters) – New York cocoa futures rose on Tuesday, boosted by technical buying and signs of recovering demand, while raw sugar slipped as bearish chart signals weighed on the market.
COCOA
* March New York cocoa was up $21 or 1.1 percent, at$1,935 a tonne by 1141 GMT.
* Dealers said the New York market, which reopened on Tuesday after the Martin Luther King Jr. Day holiday, was catching up with gains made in London on Monday.
* On Monday, data also showed Europe’s grindings rose to a record for the fourth quarter in a data set going back to 1999.
* However, dealers said the market was cautious amid signs of another year of strong production in top grower Ivory Coast.
* “People are cautious because yes, the arrivals do look strong,” said one dealer. “What will prevent a surplus as big as what we had last year is the demand. Otherwise, I think we’re heading for a very good crop.”
* The market is now awaiting figures from North America and Asia, due out on Thursday. Dealers are anticipating a 1-3 percent rise in North America and at least a 5 percent increase in Asia.
* March London cocoa fell 10 pounds, or 0.7 percent, to 1,394 pounds a tonne, giving up some of Monday’s gains.
SUGAR
* March raw sugar was down 0.15 cent, or 1.1 percent, at 14.03 cents per lb, catching up with a drop in white sugar on Monday.
* Dealers noted prices were weighed down by bearish chart signals after the market’s structure was battered in last week’s speculative sell-off.
* “The bears will be targeting a breach of 14.00 this week, with a potential downside target of 13.70,” Geordie Wilkes, technical analyst at Sucden Financial, said in a note.
* A looming supply glut for 2017/18 – and potentially further ahead – was also dampening sentiment.
* Dealers also said the market was vulnerable to producer selling, as some had missed the opportunity to sell into the rally earlier this month.
* March white sugar was down $1.90, or 0.5 percent, at $375 a tonne.
COFFEE
* March arabica coffee was down 1.05 cents, or 0.9 percent, at $1.2120 per lb, after touching $1.2085, its lowest since Dec. 26.
* Dealers noted the technical structure was weakened on Friday, the market’s last trading session, when prices slipped below key support levels.
* March robusta coffee was up $3 or 0.2 percent at $1,732 a tonne.
