Cocoa closes down in volatile trade, raw sugar rises
Cocoa futures on ICE experienced volatility, with September London cocoa settling slightly down at 6,633 pounds per metric ton and New York cocoa falling 0.7% to $7,790 a ton, rebounding from a morning dip of over 6%. Improved trading volumes were noted, driven by hedging interest amid uncertain West African weather for the upcoming crop. Meanwhile, robusta coffee eased to $4,059 a ton, while arabica fell 2.2% to $2.2435 per lb, with Brazil needing more rain for soil moisture. July raw sugar rose 0.7% to 19.24 cents per lb ahead of Brazil’s production data release, expected to show a 14% increase.
NEW YORK, June 26 (Reuters) -Cocoa futures on ICE closed down on Wednesday in another very volatile trading session for the chocolate ingredient, while raw sugar futures rose despite the weak Brazilian currency.
COCOA
* September London cocoa LCCc2 settled down 5 pounds, or 0.1%, to 6,633 pounds per metric ton, recovering late in the session after falling more than 5% in the morning.
* September New York cocoa CCc2 fell 0.7% to $7,790 a ton, after dipping more than 6% earlier.
* Dealers noted improved volumes, and said there had been some interest in price hedging, which involves traders taking short futures positions or bets on price falls, to offset their long physical position.
* The weather in West Africa has also improved, they said, though more rain is needed to improve the outlook for the upcoming 2024/25 crop.
* The cocoa futures curve remains heavily backwardated, despite the price retreat of the last few trading sessions, indicating overall supplies are tight.
COFFEE
* September robusta coffee LRCc2 settled down $58, or 1.4%, at $4,059 a ton, some way off this month’s record high of $4,394.
* Dealers said spot market prices in top robusta producer Vietnam have stabilised near record levels.
* The Vietnam market remains tight, however, with visible stocks at end-May at 238,020, down 171,078 tons versus a year ago.
* September arabica coffee KCc2 fell 2.2% at $2.2435 per lb, having slid 2.9% on Tuesday.
* There is forecast for some light showers over Brazil arabica coffee areas next week, but more is needed to improve soil moisture.
SUGAR
* July raw sugar SBc1 settled up 0.14 cent, or 0.7%, at 19.24 cents per lb, having settled down 1.6% on Tuesday.
* The July contract will expire on Friday. Dealers’ estimates for the delivery range between 1.2-1.5 million tons.
* Brazil’s industry group UNICA should release production data for the first half of June this week. A survey of analysts by S&P Global Commodity Insights indicate sugar production at 2.92 million tons, 14% more than last year.
* August white sugar LSUc1 rose 1.3% at $569.20 a ton.
Source Link : https://www.xm.com/research/markets/allNews/reuters/cocoa-closes-down-in-volatile-trade-raw-sugar-rises-53868843
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