November 22, 2019 / 1:09 PM / 9 months ago

SOFTS-Arabica coffee retreats after hitting 1-yr high

LONDON, Nov 22 (Reuters) - ICE arabica coffee futures retreated on Friday after hitting a one year high in the previous session on heavy short covering from funds amid signs of tightening supplies.


* March arabica coffee fell 1.3 cents, or 1.1%, to$1.1495 per lb at 1219 GMT, having hit its highest level since last November at $1.1680.

* Arabica supplies are tightening from recent record high levels, with a global deficit forecast for the 2019/20 season, an off-year in top producer Brazil’s biennial crop cycle.

* Certified arabica stocks KC-TOT-TOT on ICE futures U.S. are at their lowest in nearly a year and a half, having fallen sharply in the last few days.

* “The market is having a bit of a collective penny drop moment, ICE stocks have drawn down for eight months. The market is even ignoring weakness in the (Brazilian) real. We could be looking at $1.25 for March arabica,” said a dealer.

* A weak real usually encourages producers to sell dollar-priced commodities coffee as it raises returns in local currency terms.

* January robusta coffee fell $9, or 0.6%, to $1,393 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.


* March raw sugar rose 0.08 cents, or 0.6%, to 12.69 cents per lb, having settled down 1.1% in the previous session.

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

* The recent decline in the real has also helped keep a lid on sugar.

* March white sugar rose $2.90, or 0.9%, to $337.20 a tonne.

* Security forces reopened the entrance to Iraq’s main Gulf port, which receives the bulk of the country’s imports of sugar, grains and vegetable oils.


* March New York cocoa was down $18, or 0.7%, to $2,624 a tonne, having hit $2,694 on Monday, the highest since May 2018.

* New York March cocoa may retest a resistance at $2,683 per tonne, technical signals indicate.

* Cocoa prices have been boosted of late by a strengthening in nearby premiums in both New York CC-1=R and London cocoa LCC-1=R, which indicate tight nearby supply.

* The outlook for production in top grower Ivory Coast remains favourable, however.

* March London cocoa was down 9 pounds, or 0.5%, at 1,913 pounds a tonne, having hit a 1-1/2 year high last week. (Reporting by Maytaal Angel Editing by Chizu Nomiyama)

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