SOFTS-Raw sugar extends recent gains, robusta also rises



© Reuters. SOFTS-Raw sugar extends recent gains, robusta also rises

LONDON, May 17 (Reuters) – Raw sugar futures rose to the highest level in almost two weeks on Thursday, while robusta coffee and prices also edged up.

SUGAR

* July raw sugar was up 0.03 cents, or 0.3 percent, at 11.64 cents per lb at 1129 GMT after climbing to a peak of 11.67 cents, the highest for the front month since May 4.

* Dealers said the market was underpinned by dry weather in top grower Brazil and the continued switch to using more cane for ethanol rather than sugar production.

* “It seems for the first time since the end of Feb there has been a potential “story” for the sugar bulls,” said Thomas Kujawa, co-head of the softs department at Sucden Financial.

* “However, the continued dry weather forecasts will have to persist for some time to come before we witness a consensus shift and further negative Brazil crop revisions,” he added.

* August white sugar rose $2.90, or 0.9 percent, to$325.40 a tonne.

COFFEE

* July robusta coffee LRCc2 climbed $17, or 1.0 percent, to $1,754 a tonne.

* Dealers noted prices were supported by waning selling by Vietnamese producers, who are said to be well sold forward and willing to hold onto coffee at current levels.

* Differentials in Vietnam have firmed up this week as a result, one dealer said, moving to discounts of roughly $60-80 per tonne. Differentials collapsed to $100-120 earlier in the month.

* July arabica coffee KCc2 rose 0.45 cents, or 0.4 percent, to $1.1775 per lb.

* Dealers said speculators were taking a breather, after pushing prices to 3-1/2 week lows earlier in the week, although the market remained vulnerable.

* “The funds are very much still not shaken out of their short position and are happy to sell rallies,” said another dealer. “And people see a lot of coffee availability.”

* Participants were also closely monitoring the Brazilian real, which has sharply weakened recently, spurring selling by producers and speculators.

* “The real is in a much weaker position so, from a Brazilian perspective, it’s attractive (to sell),” the dealer said. “What it has done is taken away any bullish momentum that might have been building on the back of short covering.”

COCOA

* July New York cocoa CCN8 fell $13, or 0.5 percent, to$2,717 a tonne, with the market around the middle of this week’s range of $2,629 to $2,849 in choppy conditions.

* July London cocoa LCCN8 rose 2 pounds, or 0.1 percent, to 1,897 pounds a tonne.

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