May 13, 2020 / 11:08 AM / 14 days ago

SOFTS-Raw sugar prices weaken as Brazil output climbs

LONDON, May 13 (Reuters) - Raw sugar futures on ICE were lower on Wednesday as a sharp increase in production in top exporter Brazil continued to exert downward pressure on prices.

SUGAR

* July raw sugar fell 0.05 cents, or 0.5%, to 10.20 cents per lb by 1100 GMT.

* Dealers said the market was pressured by a switch by mills in the key Centre-South region of Brazil to using more cane to make sugar rather than biofuel ethanol than in the same period last season.

* “Despite the better performance of oil prices and the gradual recovery of economic activity around the world, sugar prices remain under pressure from the prospects of a strong increase in Brazilian production,” analyst Agritel said in a note.

* August white sugar was down $0.20, or 0.1%, at $344 a tonne.

COFFEE

* July arabica coffee fell 0.8 cents, or 0.75%, to $1.0655 per lb.

* Dealers said the initial pick-up in in-home demand linked to lockdowns across the globe appeared to be beginning to fade while out-of-home consumption looked set to remain weak.

* Brazil exported 2.99 million 60kg bags of green coffee to overseas clients in April, 1.5% more than in the same month a year ago, industry association Cecafe said.

* July robusta coffee fell $12, or 1%, to $1,168 a tonne.

* Vietnam, the world’s top robusta producer, exported 165,799 tonnes, or 2.76 million 60kg bags, of coffee in April, down 2.5% from March, customs data showed on Wednesday.

COCOA

* July New York cocoa was down $2, or 0.1%, at $2,400 a tonne.

* Dealers said the market had been underpinned recently by a decline in port arrivals in top producer Ivory Coast and logistical challenges linked to measures to slow the spread of the novel coronavirus.

* Weakness in demand, however, remains a bearish factor.

* “Despite global recession, origin grinds in April were flat year on year and are plus 3-4% season to date, but this probably masks second-quarter losses across the European and North American regions and possibly Asia,” said Citi analyst Aakash Doshi.

* Doshi forecasts a global cocoa surplus of 30,000 tonnes in 2019/20, widening to 150,000 tonnes in 2020/21.

* July London cocoa fell 11 pounds, or 0.6%, to 1,911 pounds a tonne​. (Reporting by Nigel Hunt Editing by David Goodman )

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