(Rewrites throughout, updates prices; adds comment, exchange data, NEW YORK dateline)
NEW YORK/LONDON, April 4 (Reuters) - Arabica coffee futures on ICE rebounded from a nine-month low on Wednesday, buoyed by heavy position rolling out of the spot contract ahead of first notice day, which sharply reduced the May contract’s discount to July.
* May arabica coffee settled up 0.3 cent, or 0.26 percent, at $1.169 per lb, bouncing off an earlier nine-month low of $1.1595.
* Funds, who hold a large net short position, are rolling out of May and into July, causing the May discount to July KCK8-N8 to narrow to as much as 1.9 cents from 2.05 cents on Tuesday, traders said.
* The move came ahead of first notice day for May on April 17 and after open interest rose to a record 279,405 contracts on Tuesday, ICE data show.
* The move higher came as the International Coffee Organization lowered its arabica production estimate, though revised its 2017/18 global coffee supply forecast to a surplus versus its previous expectation for a small deficit.
* Low prices spurred Colombia’s coffee federation on Tuesday to ask the government for direct help for farmers.
* May robusta coffee settled up $16, or 0.9 percent, at $1,755 per tonne.
* May New York cocoa settled down $23, or 0.9 percent, at $2,475 per tonne.
* Prices extended losses after tumbling 5.2 percent in heavy volume the prior session, their biggest one-day fall in nearly 11 months. Prices were no longer in technically overbought territory, having fallen more than $170 below Monday’s 1-1/2-year high of $2,647.
* An improving outlook for crops in top grower Ivory Coast has weighed on prices, traders said, with farmers describing their trees being loaded with ripe cocoa pods.
* May London cocoa settled down 8 pounds, or 0.5 percent, at 1,725 pounds per tonne.
* May raw sugar settled down 0.2 cent, or 1.6 percent, at 12.27 cents per lb.
* The spot contract neared last week’s 2-1/2 year low of 12.18 cents, as production at Indian sugar mills rose sharply in the first half of the 2017/18 marketing year, contributing to the global oversupply.
* “This is a 49 percent increase year-on-year and it is looking very likely that India will produce a record crop this season,” ING said in a market note, adding that at the end of March 331 out of 524 mills were still operating.
* May white sugar settled down $3.50, or 1 percent, at $351.20 per tonne. (Reporting by Marcy Nicholson in New York and Nigel Hunt in London Editing by David Holmes and Diane Craft)