Rising crude oil prices boost raw sugar futures, while London cocoa retreats from a three-and-a-half-month high
- Raw sugar futures rose 1.6% on Tuesday to 15.15 cents per pound, supported by stronger crude oil prices. White sugar increased by 2.2% to $446.90 per ton. Crude oil prices rose about 2% as hopes for a ceasefire agreement between Israel and Iran diminished, bringing supply concerns back into focus. Higher energy prices may result in more sugarcane being used to produce biofuel ethanol, thereby reducing sugar output and supply.
- London cocoa fell 1.6% to £3,427 per ton, having touched a three-and-a-half-month high of £3,549 earlier in the session. Traders said that recent price gains driven by short covering have at least temporarily faded. The expiration of the May contract on Wednesday becomes a short-term focus. Meanwhile, the premium of the May contract over the July contract is narrowing, indicating ample supply. New York cocoa fell 2% to $4,613 per ton, down from the previous trading day's three-and-a-half-month high of $4,777. The President of Brazil has signed a bill setting minimum cocoa content requirements for chocolate.
- Arabica coffee fell 0.3% to $2.8140 per pound, after hitting a one-and-a-half-year low of $2.68 per pound on Monday. Traders said harvesting of Brazil’s bumper crop is accelerating, putting downward pressure on prices. Robusta coffee rose 0.2% to $3,510 per ton.
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