November 21, 2019 / 12:32 PM / 18 days ago

SOFTS-Arabica coffee falls after sharp gains; sugar, cocoa also slip

LONDON, Nov 21 (Reuters) - ICE arabica coffee futures fell on Thursday as the market readjusted from sharp gains in the previous session, while sugar and cocoa also slipped.

COFFEE

* March arabica coffee was down 0.9 cent, or 0.8%, at$1.1010 per lb at 1210 GMT, having closed up 2.3% on Wednesday.

* Funds have scaled back a net short position in arabica in the last few weeks, boosting coffee.

* At the same time, arabica supplies are tightening from recent record levels, with a global deficit generally forecast for the 2019/20 season, an off-year in Brazil’s biennial crop cycle.

* “Brazil has sold a good chunk of this year and next year’s crop, they’re not enticed to sell more (for now) if they see the market moving up,” said a dealer.

* Arabica futures are forecast to rise by the end of next year as exchange stocks decline, Rabobank said in an Outlook 2020 report.

* January robusta coffee fell $18, or 1.3%, to $1,368 per tonne.

* Domestic coffee prices in Vietnam, the world’s top robusta producer, fell slightly this week, with traders saying 2019/20 output would be similar to the previous season.

SUGAR

* March raw sugar fell 0.05 cent, or 0.4%, to 12.70 cents per lb, having settled up 0.5% in the previous session on news of weak Indian output.

* Sugar remains stuck within recent ranges as falling output in the 2019/20 year is offset by the selling of excess global stocks built up over the past few years of surplus.

* The recent decline in Brazil’s real has also helped keep a lid on sugar. A weak real raises the value of dollar-priced sugar in Brazilian currency terms, tempting producers to sell.

* Indian sugar mills produced 485,000 tonnes of the sweetener between Oct. 1 and Nov. 15, down sharply from 1.34 million tonnes last year.

* “This would normally point to a higher sugar price if it were not for the high domestic stocks that will allow India to continue exporting large amounts of sugar,” Commerzbank said in a note.

* March white sugar rose $0.30, or 0.1%, to $336.90 a tonne.

COCOA

* March New York cocoa was down $4, or 0.2%, at $2,624 a tonne, retreating further after hitting $2,694 on Monday, the highest level since May 2018.

* March London cocoa was down 3 pounds, or 0.2%, at 1,917 pounds a tonne, having hit a 1-1/2 year high last week. (Reporting by Maytaal Angel; Editing by Pravin Char)

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