* Arabica prices seen high until crop damage clearer-analyst
* ICE cocoa prices are below 2-1/2-year high
By David Brough
LONDON, March 19 (Reuters) - Arabica coffee futures on ICE edged higher on Wednesday having slipped from last week’s highs partly due to expectations that the weather in Brazil could improve in the coming weeks, while raw sugar held steady.
Cocoa futures were steady and remained below a 2-1/2-year high, boosted by strong consumption growth that was expected to outstrip supply.
Arabica coffee consolidated as the market digested the major gains made in the past two months which saw prices push up as much as 85 percent since the start of the year due to dry weather in top grower Brazil.
“If sufficient rains come in Brazil, this might take some of the weather premium out of the market, although some irreversible damage has certainly been done,” said Birgit Wippler, soft commodities analyst with F.O. Licht.
“Prices will remain elevated at least until we get a clearer picture of the extent of damage from the drought, when farmers start harvesting.”
May arabica coffee futures on ICE edged up 0.5 cents or 0.3 percent to $1.9205 per lb at 1249 GMT. The second month peaked at $2.0975 last week, its highest level since February 2012.
May robusta coffee futures rose $5 or 0.2 percent to $2,140 a tonne, below last week’s 17-month high of $2,218.
Raw sugar futures were slightly higher but remained below their four-month peak of 18.47 cents hit earlier this month when dry weather concerns in Brazil drove prices higher.
Analysts expect ample stocks should provide a buffer to any production losses in Brazil.
“Sugar continues to be available, and that availability will only increase as we go into the new crop in the centre-south of Brazil,” said James Kirkup, head of sugar brokerage at ABN AMRO in London.
May raw sugar futures on ICE were down 0.01 cent, or 0.1 percent, at 17.13 cents a lb.
Liffe May white sugar futures were up $0.70 or 0.2 percent at $456.80 per tonne in light volume of 692 lots.
Cocoa futures on ICE were little changed with May up $12 or 0.4 percent at $3,026, holding just below Monday’s 2-1/2-year high of $3,047.
The global cocoa market is facing its second consecutive global deficit in 2013/14.
The growing likelihood of an El Nino weather event underpinned cocoa prices as adverse weather in growing countries could tighten supply.
El Nino can cause flooding and heavy rains in the United States and South America and drought in Southeast Asia and Australia.
Cocoa futures on Liffe were firm with July prices up 1 pound or 0.05 percent at 1,894 pounds a tonne.
“Selling pressure could see prices test the 10-day moving average at 1,868 pounds before targeting the 40-day moving average at 1,841 pounds, while protracted declines could test recent lows towards 1,800,” said research analyst Kash Kamal of Sucden Financial. (Reporting by David Brough; editing by Keiron Henderson)