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SOFTS-Raw sugar at 2-1/2-week top as Brazil currency rebounds

CommoditiesMay 19, 2017 23:30
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© Reuters. SOFTS-Raw sugar at 2-1/2-week top as Brazil currency rebounds

(Updates prices; adds comment, NEW YORK dateline)

NEW YORK/LONDON, May 19 (Reuters) - Raw sugar futures rose to a 2-1/2-week high on Friday, bouncing up from the prior session's steep losses on support from a firmer currency in top grower Brazil and forecasts for adverse weather there, while arabica coffee prices also recovered.

SUGAR

* July raw sugar SBc1 settled up 0.35 cent, or 2.2 percent, at 16.38 cents per lb, the highest since May 2.

* The spot contract closed the week up 5.6 percent, its strongest weekly gain in 4-1/2 months.

* Support came from a firmer Brazilian real BRL= a day after posting its biggest percentage drop against the dollar since 1999. The weakness, triggered by allegations that Brazil President Michel Temer condoned bribing a potential witness, also sent raw sugar tumbling on Thursday.

* Forecasts for heavy rains in top grower Brazil, which could disrupt production in the short-term, also lent support.

* However, dealers noted ample supplies still cap upside potential.

* "Events outside the market are adding to volatility and perhaps are overtaking the fundamentals," said Nick Penney, senior trader at Sucden. "The current range is 15.50/16.50 (cents) and we will see which end gets tested once the political dust settles."

* August white sugar LSUc1 settled up $9.30, or 2 percent, at $464.60 per tonne.

COFFEE

* July arabica coffee KCN7 settled up 2.45 cent, or 1.9 percent, at $1.321 per lb, also supported by the firm Brazilian real versus the U.S. dollar

* The contract finished the week down 2.1 percent.

* "Short-term there's nothing bullish about coffee. Green coffee stocks are tremendous in the U.S. and Europe," said Nick Gentile, managing partner of commodity trading advisor NickJen Capital.

* "The harvest is just starting (and) CONAB came out and lowered the crop (forecast)," Gentile said.

* Dealers said prices could come under renewed pressure if the Brazilian real BRL= slips further, as Brazil grapples with the fallout of the Temer scandal.

* July robusta coffee LRCc2 settled down $7, or 0.4 percent, at $1,977 per tonne.

COCOA

* July London cocoa LCCc1 settled down 42 pounds, or 2.6 percent, at 1,563 pounds per tonne.

* New York cocoa CCc1 settled down $56, or 2.7 percent, at $2,028 per tonne. It closed the week up 0.6 percent.

* Market weakness surprised traders, with prices consolidating below Thursday's six-week high and hugging the 100-day moving average at $2,036.

* Cocoa arrivals at ports in top grower Ivory Coast were up 19.6 percent from a year ago, exporters estimated.

SOFTS-Raw sugar at 2-1/2-week top as Brazil currency rebounds
 

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