Arabica coffee hits three-week high, cocoa climbs
LONDON — Arabica coffee futures rose to a three-week high on Wednesday as the market slowly regained ground after a prolonged decline while cocoa futures also climbed.
* March arabica coffee was up 0.75% to $1.6105 per lb by 1439 GMT after setting a three-week peak of $1.6330.
* Prices have been edging back up during the last couple of weeks after hitting a 1-1/2-year low of $1.4205 on Jan. 11.
* “We expect to see continued strength in the near term, but momentum is waning,” Sucden Financial said in a technical note.
* Dealers noted ICE certified stocks had stabilized after their recent climb, although there was still a significant volume of coffee to be graded.
* ICE certified coffee stocks stood at 858,647 bags as of Jan. 24, marginally below a six-month high of 859,564 bags set on Jan. 19. There were 125,209 bags pending grading.
* March robusta coffee rose 0.4% to $1,951 a tonne.
* March New York cocoa rose 0.6% to $2,601 a tonne.
* Dealers said ongoing crop problems in No. 2 producer Ghana linked to swollen shoot virus outbreaks remained a concern, although the outlook remained generally favorable in other parts of West Africa.
* “This (a favorable outlook in Ivory Coast, Cameroon and Nigeria) has raised the prospect of a stronger-than-expected crop and could cap further upside for cocoa prices,” fund manager Wisdom Tree said in a report on Wednesday.
* There have also been concerns about weakening demand following recent year-on-year declines in fourth-quarter grinds in Europe, North America and Asia.
* March London cocoa rose 0.35% to 2,001 pounds a tonne.
* March raw sugar rose 0.35% to 19.94 cents per lb.
* Dealers said the market had derived support from news that state-run oil firm Petrobras was raising gasoline prices in Brazil, a move which could encourage mills to use cane to make biofuel ethanol rather than sugar.
* March white sugar fell 0.55% to $544.70 a tonne. (Reporting by Nigel Hunt; Editing by Alexander Smith and Paul Simao)
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