The futures of coffee arabica on ICE closed higher on Tuesday, extending its recovery from a recent year-and-a-half low, although gains were limited by concerns about demand.
Robusta coffee hit a three-month high, while raw sugar futures rallied.
March arabica closed up 1.3 cents, or 0.8%, at $1.5985 a pound, after hitting a two-and-a-half-week high of $1.6125.
Traders noted that speculators had moved into their biggest net short position since October 2019, indicating substantial confidence in falling prices.
Still, strong premiums in the physical market have encouraged some buyers to turn to ICE-certified stocks, leading to a pick-up in withdrawals from the exchange’s warehouses of late.
March Robusta coffee rose $2, or 0.1%, to $1,943 a tonne, hitting a new three-month high.
THE sugar March crude rose 18 cents, or 0.9%, to 19.88 cents a pound.
Traders cited Brazil’s gasoline price hike as favorable, as it is likely to increase ethanol’s appeal to mills.
UK sugar production in the 2022/23 marketing year is expected to be lower than previously expected following adverse weather, British Sugar said.
France pulled out of its 2023 plans to allow sugar beet growers to again use a pesticide banned due to risks to bees after a European Union court rejected such exemptions.
White sugar for March was up $0.30, or 0.1%, to $547.70 a tonne.
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