March 25, 2019 / 1:58 PM / 3 months ago

SOFTS-Raw sugar prices hit 1-week low, coffee steadies

(Adds quote, updates prices)

LONDON, March 25 (Reuters) - Raw sugar prices hit a one week low on Monday as oil prices fell and traders squared positions after prices rose 0.4 percent last week, while arabica coffee steadied after hitting new contract lows.

SUGAR

* May raw sugar was down 0.17 cent, or 1.4 percent, to 12.40 cents per lb at 1317 GMT, having hit its lowest since March 15 at 12.33 cents.

* Oil prices slipped on Monday, prompting funds to sell biofuel ethanol. Falling ethanol prices tend to weigh on sugar by prompting Brazilian cane mills to produce more of the sweetener rather than the biofuel

* Rabobank analyst Carlos Mera said ethanol stocks had been rising in Brazil, adding that once the cane harvest started in April, this could weigh on prices of the biofuel, prompting sharp falls in sugar. “You’ll have a double whammy of low ethanol (prices) combined with very low sugar prices,” he said

* Speculators reduced their net short position on ICE U.S. raw sugar futures by 12,027 contracts to 123,183 contracts in the week to March 19.

* Agricultural commodity merchant Louis Dreyfus Company reported improved results in 2018 sugar trading on Monday.

* Farmers in western Europe have begun sugar beet planting, with signs indicating a decline in area.

* Brazilian mills in the main cane belt, however, are expected to produce 7 percent more sugar in the new season.

* May white sugar fell $2.9, or 0.86 percent, to $332.50 per tonne.

COFFEE

* May arabica coffee rose 0.25 cent, or 0.27 percent, to 94.15 cents per lb after setting a fresh contract low of 92.60 cents.

* The monthly contract shed 3.9 percent last week and has posted declines in seven of the past eight weeks.

* Coffee prices have collapsed on excess supplies, with top grower Brazil forecast to have a massive 2019-20 crop despite it being the off-year in arabica’s biennial crop cycle.

* Speculators reduced their bearish stance on ICE U.S. arabica coffee futures by 3,666 lots to 74,939 lots. This comes after five straight weeks in which they upped their bearish position.

* May robusta coffee fell $7, or 0.47 percent, to $1,487 per tonne.

COCOA

* May New York cocoa rose $52, or 2.41 percent, to $2,211 per tonne.

* Speculators lifted their net short position in ICE U.S. cocoa futures to a 1-1/2 year high of 46,084 contracts in the week to March 19.

* May London cocoa rose 43 pounds, or 2.64 percent, to 1,671 pounds per tonne. (Reporting by Maytaal Angel; Editing by Mark Potter)

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