SOFTS-Arabica coffee hits 1-year high; sugar retreats from 4-year peak

  • Reuters
  • Commodities News
SOFTS-Arabica coffee hits 1-year high; sugar retreats from 4-year peak

(Recasts, includes closing prices and comments)

NEW YORK/LONDON, Feb 23 (Reuters) - Arabica coffee futures continued their impressive run on Tuesday, closing up for the sixth consecutive session and hitting the highest price in more than a year.

White and raw sugar futures closed down, but touched a nearly four-year high earlier in the session.

SUGAR

* March raw sugar SBc1 closed down 2% to 18.41 cents per lb, having touched its highest since March 2017 at 18.94.

* Dealers said they expected prices to fall back, on some profit-taking, though that should be short-lived because funds are likely to see such a dip as another buying opportunity.

* Nearby supplies remain tight after a poor Thai crop and disruptions to transportation hampering India's exports. At the same time, the macro environment continues to improve amid signs the COVID-19 vaccine rollout is starting to contain the virus.

* May white sugar LSUc1 lost $10 to $478.40 a tonne, having also reached its highest since March 2017 at $490.10 earlier in the session.

COFFEE

* May arabica coffee KCc2 settled up 3.35 cents, or 2.5%, at $1.383 per lb. Arabica hit its highest since December 2019 during the session.

* Coffee is being boosted by worries about Brazil's forthcoming crop and global inflation expectations. A shortage in global shipping container availability is also buoying prices.

* "We reduce our Brazil 2021/22 estimate to 56.2 million bags (of which 36 million bags of arabica), given the continued drier-than-normal weather in Brazil," Rabobank said in its first quarter outlook. "Border disruptions and astronomical container shipping rates increase appetite for processors to increase inventories. The outlook for premium coffee and for post-COVID demand remains strong," it said.

* May robusta coffee LRCc2 settled up $44, or 3.1%, at $1,460 a tonne.

COCOA

* May London cocoa LCCc2 ​​settled up 1 pound, or 0.1%, to 1,697 pounds per tonne​.

* May New York cocoa CCc2 ​​settled up $9, or 0.4%, to $2,499 a tonne.

* Cocoa has been rangebound since December, trapped between forecasts for a large surplus this season and hopes for a global economic recovery.

* Dealers said cocoa looks cheap further down the curve because market balances could tighten next season.

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