April 2, 2019 / 12:20 PM / 3 months ago

SOFTS-Arabica coffee hit 13-year low, robusta also falls

LONDON, April 2 (Reuters) - Arabica coffee futures on ICE fell to their lowest level in more than 13 years on Tuesday as the market continued to struggle to absorb excess supplies.

COFFEE

* May arabica coffee was down a quarter of a cent, or 0.3 percent, at 91.85 cents per lb by 1205 GMT after dipping to 91.25 cents, the weakest for the front month since December 2005.

* Dealers said speculators were extending net short positions against the backdrop of excess supplies.

* “The specs just seem to hammer it every day relentlessly,” one dealer said, adding that Brazil would start to harvest a large arabica crop next month even though it is an off-year in its biennial crop cycle.

* May robusta coffee was down $10, or 0.7 percent at $1,408 a tonne after dipping to a low of $1,395, the weakest for the front month since March 2016.

* Dealers said the harvest of Brazil’s robusta crop, known as conillons, was about to start and could hit a record production peak of around 20 million bags.

SUGAR

* May raw sugar rose 0.02 cents, or 0.2 percent, to 12.69 cents per lb after touching 12.7 cents, the highest level for the front month in almost a week.

* Dealers said the market was underpinned by continued strength in crude oil prices, which should help to boost the incentive for mills in Brazil to use cane to make ethanol rather than sugar.

* Oil hit a 2019 high above $69 a barrel on Tuesday on the prospect of more sanctions against Iran and further Venezuelan disruptions deepening an OPEC-led supply cut while the market became less worried that demand could slow.

* “The (crude oil) gains portend high levels for oil prices during Centre-South Brazil’s crushing season, further ensuring that the region’s mills will focus on ethanol production as much as possible,” Commonwealth Bank of Australia analyst Tobin Gorey said in market note.

* May white sugar was up $1.50, or 0.45 percent, at $331.60 a tonne.

COCOA

* May London cocoa rose 5 pounds, or 0.3 percent, to 1,754 pounds a tonne, underpinned by the weakness of sterling.

* The pound fell on Tuesday as British Prime Minister Theresa May came under pressure to resolve the Brexit crisis by either calling an election or leaving the European Union without a deal.

* May New York cocoa fell $6, or 0.3 percent, to $2,321 a tonne. (Reporting by Nigel Hunt Editing by David Goodman )

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