Coffee rebounds from 16-month low
By Onome Amuge
Arabica coffee futures ended the week in bullish form as the market extended its rebound from previous week’s 16-month low, towards a six percent weekly rise.
March arabica coffee was up 2.3 cents, or 1.4 percent, at $1.6505 per pound as the market pulled further away from previous week’s 16-month low of $1.5405. The contract also rose 6.4 percent in the week, regaining most of the ground lost the previous week when prices fell by 7.7 percent.
January robusta coffee also traded in a similar terrain, gaining $15, or 0.8 percent, at $1,857 a tonne.
Market dealers observed that the robusta market has been supported by rains in Vietnam that have disrupted the harvest.
On the other hand, Brazilian farmers and agronomists have downgraded their views, however, for next year’s crop after the post-flowering period.
For the sugar market, raw sugar reverted an early jump towards a weekly plunge.
March raw sugar was down 0.22 cents, or 1.1 percent, at 19.33 cents per pound while the contract shed 3.6 percent in the week. March white sugar also declined $9.40, or 1.7 percent, at $529.70 a tonne
Dealers noted mills in Brazil continued to favour using cane for sugar rather than ethanol production.
Archer Consulting, a leading commodities consulting group, in its market analysis of the sweet commodity reported a high volume of hedging by Brazilian mills for next year’s crop, estimating that dealers would receive 49 percent of expected exports.
Sugar broker Czarnikow also cut its forecast for global sugar surplus for the current 2022/23 season to two million tonnes from 3.6 million previously.
Trading volumes were smaller than average as reports showed that many dealers in the US were still away from desks after Thursday’s Thanksgiving Day.
Meanwhile, the cocoa market maintained its bullish ride as March New York cocoa gained $40, or 1.6 percent, to $2,484 a tonne. The contract also gained one percent in the week. March London cocoa also firmed 26 pounds, or 1.3 percent, to 1,985 pounds per tonne.
Dealers noted that prices were underpinned by a shortfall in supply following reports of heavy rains and flash floods across leading production zones.