Sugar rebounds from 1-year low as fund selling eases
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Raw sugar futures traded higher on the Intercontinental Exchange (ICE) as the market steadily recovered from a one-year low of 17.20 cents set earlier in the week. October raw sugar was up 0.39 cent, or 2.2 percent to 17.94 cents per pound, while October white sugar climbed $22.90 or 4.3 percent to $550.90 a tonne. Market dealers noted that the recent bout of fund selling had abated significantly, setting sugar to a recovery route after stumbling to a one-year low. This comes after data from the Commodity Futures Trading Commission (CFTC) showed that funds had increased their short position in sugar in the
week to Aug. 2. Meanwhile, top producer India is expected to allow the exportation of an additional 1.2 million tonnes of the sweet commodity to boost supply in the global market. This, according to dealers, could see prices of raw sugar slip, while supporting white sugar futures. On the other hand, arabica coffee prices fell sharply as concerns that a global economic downturn could curb consumption of coffee remained a bearish influence while a stronger dollar also weighed on prices. As a result, September arabica coffee slipped 9.85 cents or 4.5 percent to $2.0945 per pound, erasing much of the gains recorded in the previous two sessions. Market data showed that coffee’s bearish stance was aggravated by reports of an increasing pace of harvest in Brazil, the world’s largest producer. The market however remained underpinned by falling stocks as ICE-certified arabica stocks fell to 660,564 bags, the lowest since July 1999 and down sharply from 2.17 million bags a year ago. Cocoa futures also landed in bearish territory as December London cocoa fell 8 pounds or 0.4 percent to £1,772 per tonne, consolidating just above a three-week low of 1,740 pounds set the previous day. December New York cocoa was down $47 or 2.0 percent to $2,341 a tonne.