April 11, 2018 / 5:45 PM / a year ago

SOFTS-Sugar prices fall to 2-1/2 year low, cocoa climbs

(Updates throughout; adds comment, NEW YORK dateline)

NEW YORK/LONDON, April 11 (Reuters) - Sugar futures on ICE extended losses to 2-1/2-year lows on Wednesday, pressured by producer hedging and ample global supplies, while cocoa prices rose.


* May raw sugar settled down 0.07 cent, or 0.6 percent, at 12.06 cents per lb, after hitting 11.93 cents, its lowest since late September 2015.

* August white sugar settled down 80 cents, or 0.2 percent, at $335.20 per tonne, after reaching its weakest since August 2015 at $332.30.

* Prices were partly pressured by hedging from Thai and Brazilian producers, with the latter rushing to take advantage of the weakening in the real currency, while short-covering and position rolling into July briefly turned prices positive, traders said.

* “There is a game of leapfrog taking place between Brazilian and Thai producers as they compete to fix export prices,” Nick Penney, senior trader at Sucden Financial, said in a market note.

* Ample global supplies and the possibility of Indian exports also remained in focus, as the country mulls a subsidy that could make exports viable.

* May white sugar, which expires on Friday, closed up 0.2 percent at $346.20 per tonne, lifting its premium over August LSUK8-Q8 to a session high of $13.30 from $10.30 the prior session.

* “The spread suggests a shortage of deliverable sugar,” said one dealer, noting current prices were unattractive to EU and Thai producers.


* July London cocoa settled up 33 pounds, or 1.9 percent, at 1,773 pounds per tonne.

* July New York cocoa settled up $49, or 1.9 percent, at $2,580 per tonne, in heavy volume due to position rolling out of May, traders said.

* Both markets remained within their recent trading ranges, with dealers pointing to speculative buying after the market held session lows from the past three weeks.

* There were signs of recovering demand as Swiss chocolate maker Barry Callebaut reported sales rose 8 percent in the six months to February, compared to global growth of 2.5 percent.

* This came after UBS downgraded Hershey Co stock to “sell” from “neutral” on Tuesday, due to slowing category consumption, intensifying competition and rising cocoa prices.


* July arabica coffee settled up 0.7 cent, or 0.6 percent, at $1.2025 per lb.

* Brazilian green coffee exports fell in March to the lowest level in six years for that month, exporters’ association Cecafé reported late Tuesday.

* May robusta coffee settled down $7, or 0.4 percent, at $1,702 per tonne. (Reporting by Marcy Nicholson in New York and Ana Ionova in London, editing by David Gregorio and David Evans)

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