February 12, 2018 / 11:37 AM / 12 days ago

SOFTS-Raw sugar climbs on weaker dollar, arabica coffee also firms

LONDON, Feb 12 (Reuters) - Raw sugar futures edged higher on Monday, extending gains on a weaker dollar and expectations for tighter nearby supplies, while arabica coffee also rose.

SUGAR

* March raw sugar was up 0.10 cents, or 0.7 percent, at 13.77 cents per lb by 1111 GMT.

* Prices were supported by a weaker U.S. dollar and more upbeat technicals after a positive close on Friday.

* Focus was also on the March-May spread SBH8-K8 with the spot premium matching Friday’s five-week high, indicating nearby demand as the spot contract nears expiry.

* Dealers said there was less available raw sugar for delivery against the futures because of reduced supplies from top grower Brazil and increased flows of Central American sugar to China.

* March white sugar rose $2.20, or 0.6 percent, to $356.90 a tonne.

* The contract expires on Tuesday, with open interest at 9,280 lots as of Friday’s close, indicating a small delivery is likely.

* The March position set a contract low last week, while the spot whites premium over the raws - a measure of refining profitability - fell to its weakest since September.

* “With raws relatively tight and whites coming out of everywhere, the white premium looks doomed to stay low, thus shutting off tolling and slowly transferring the surplus from whites to raws,” Marex Spectron said in an update.

COFFEE

* March arabica coffee was up 0.75 cents, or 0.6 percent, at $1.2260 per lb as a softer dollar helped the market to recover some of Friday’s losses.

* Prices have been pressured by producer selling, coupled with a weaker Brazilian real and expectations for ample global supplies.

* March robusta coffee rose $8, or 0.5 percent, to $1,801 a tonne.

* Costa Rica will lift a 30-year ban on planting robusta trees, which are more resistant to disease and rising temperatures than arabica, the Minister of Agriculture said on Friday.

COCOA

* March New York cocoa rose $11, or 0.5 percent, to $2,071 a tonne.

* Speculators switched to a bullish stance in New York cocoa contracts on ICE Futures U.S. in the week to Feb. 6 for their biggest net long position in 15 months, exchange data showed on Friday.

* “While another surplus is expected this season, it did appear that the spec short was overstretched,” ING said in a market note.

* May London cocoa was up 2 pounds, or 0.1 percent, at 1,490 pounds a tonne. (Reporting by Ana Ionova; Editing by David Goodman)

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