April 29, 2020 / 10:51 AM / in a month

SOFTS-Raw sugar rebounds, boosted by crude oil gains

LONDON, April 29 (Reuters) - ICE raw sugar futures were higher on Wednesday, rebounding from the prior session’s 12-1/2 year low, while coffee and cocoa prices also advanced.

SUGAR

* May raw sugar was up ​​0.24 cents, or 2.6%, to 9.58 cents per lb at 1040 GMT. The front month had fallen to a 12-1/2 year low of 9.05 cents on Tuesday.

* Dealers said gains in crude oil had helped to prompt a short covering rally in raw sugar.

* There remain concerns that recent weakness in energy markets will mean Brazilian mills use as much cane as they can to produce sugar this season rather than biofuel ethanol.

* “Without any doubt, Brazilian producers will radically change their production intentions between sugar and ethanol,” analysts Agritel said in a note.

* Data from Brazil sugar industry group Unica, which is expected to be issued later on Wednesday, should provide an early indication of the extent to which mills are switching to sugar. The report covers the first half of April.

* Dealers noted the May raws contract is due to expire on Thursday and there remained the potential for a large delivery. The open interest, as of Monday, stood at 54,498 lots which equates to around 2.7 million tonnes. * August white sugar rose $5.30, or 1.7%, to $317 a tonne.

COFFEE

* July arabica coffee rose 0.80 cents, or 0.7%, to $1.0855 per lb, edging away from a one-month low of $1.0590 set on both Monday and Tuesday.

* Dealers said the prospect of a large harvest in Brazil this year remained a bearish factor along with the weakness of the top producer’s currency, which could ensure the crop remains attractive for growers as prices in local currency terms are comparatively strong.

* July robusta coffee was up $4, or 0.3%, at $1,184 a tonne.

* Vietnam’s coffee exports in the first four months of the year likely rose 4.5% from a year earlier, government data released on Wednesday showed.

COCOA

* July New York cocoa was up $24, or 1.0%, at $2,366 a tonne.

* July London cocoa rose 28 pounds, or 1.5%, to 1,928 pounds per tonne​. (Reporting by Nigel Hunt; Editing by Mark Potter)

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