Cocoa futures on ICE fell more than 10percent this week, although showing some recovery late on Friday, while coffee futures also saw significant weekly losses.
COCOA
London cocoa settled up 127 pounds, or 5.9percent, to 2,273 pounds per metric ton after tumbling to a 2-1/2 year low of 2,128 pounds earlier in the session.
The market posted a weekly loss of 12percent. Dealers said prices had been pressured by both speculative and origin selling and psychological support around 2,000 pounds could be tested in the near future. The steep fall in prices has, however, left the market technically oversold so there could be a short-term bounce.
Weak demand has contributed to an expected global surplus of around 300,000 to 400,000 metric tons, with stocks piling up in both Ivory Coast and Ghana.
New York cocoa gained 3.9percent to USD3,178 a ton, having hit a 2-1/2 year low of USD3,031. It fell 13percent in the week.
SUGAR
Raw sugar settled up 0.23 cent, or 1.6percent, at 14.30 cents per lb. It gained 3.7percent in the week. The market slumped to a five-year low of 13.67 cents last week.
Dealers said there were some tentative signs that the prolonged slide in prices may have run its course, although ample global supplies could limit the scope of a rebound.
White sugar rose 0.8percent to USD406.60 a ton, having gained 2.4percent in the week.
South Africa’s trade ministry said on Friday it would oppose the liquidation of producer Tongaat Hulett, warning of severe consequences for jobs, farmers, and the country’s sugar industry. The US sugar industry could be impacted by regulatory changes as the federal government prepares to implement stricter dietary guidelines.
COFFEE
Arabica coffee was little changed at USD2.857 per pound. The contract lost 4.2percent weekly.
Dealers said recent rains had boosted prospects of a bumper crop in Brazil this year, but farmers there remains reluctant to sell at current prices.
“My guess is that a healthy rally needs to happen soon to unlock a wave of fresh selling,” said Cazarini Trading Company in a note to clients.
“There is a lot of demand for nearby and even new crop. The price gap between buyer and seller is notable,” it said. Robusta coffee settled down USD29, or 0.8percent, at USD3,591 a ton. It lost 6percent in the week.
Reuters
