© Reuters. SOFTS-Arabica coffee hits six-week high before retreating
(Recasts; updates prices and market activity; adds comments, ICE (NYSE:) data, NEW YORK to dateline)
NEW YORK/LONDON, May 24 (Reuters) – Arabica coffee futures on ICE hit a more than six-week high before retreating on Friday, as the market’s rally on concerns over cold weather in Brazil ran out of steam, while sugar and cocoa prices rose.
* July arabica coffee settled down 0.2 cent, or 0.2%, at 93.30 cents per lb, after earlier peaking at 95 cents, its highest since April 5.
* On the week, the contract rose 6.8%, its best weekly performance of 2019.
* Coffee prices have been under immense pressure this year due to excess global supplies. Last month, the front month contract plunged to a 13-1/2 year low of 86.35 cents.
* Prices have been supported this week, however, by concerns about potential crop-damaging weather in top-grower Brazil, with Somar Meteorologia forecasting cold temperatures that could result in a frost.
* The market has also been supported by a firmer Brazilian currency, which recovered after hitting eight-month lows against U.S. dollar on Monday.
* “The long-term picture is still bearish,” said a dealer. He added, however: “The main issue at the moment is most of the negative fundamental news (has) been priced in … so the market is prone to any bullish story (for now).”
* July robusta coffee LRCc2 settled down $1, or 0.1%, at $1,368 per tonne. The contract rose 5.2% on the week.
* July raw sugar settled up 0.09 cent, or 0.8%, at 11.66 cents per lb, after trading within the previous session’s range.
* On the week, the contract rose nearly 1%, following five straight weeks of declines.
* Total open interest climbed for the sixth straight session on Thursday to reach 1,042,750 lots, its highest since late August, ICE data show. This likely indicated new shorts in the market, dealers said.
* Global sugar output is set to increase 1% in 2019/20 from the previous period, as production in Brazil and the European Union more than outweighs the decline in India, the U.S. Department of Agriculture said. August white sugar settled up $2.30, or 0.7%, at $324.40 per tonne.
* July New York cocoa settled up $41, or 1.7%, at $2,467 per tonne. On the week, the contract jumped 4.8%.
* July London cocoa settled up 16 pounds, or 0.9 percent, at 1,789 pounds per tonne. The contract rose 3.5% on the week, its first positive weekly finish in three weeks.
* Prices have been underpinned by concerns that output from second-largest producer Ghana could be diminished as farmers there grapple with crop disease, dealers said.