Raw sugar rose the most in more than a week on signs that rains will hamper crops in Brazil, the world’s top producer. Coffee gained, while cocoa slid.
Rains are forecast to last through the beginning of next week, according to Marco Antonio dos Santos, an agronomist at weather forecaster Somar Meteorologia in Sao Paulo. Rainfall has slowed Brazil’s sugar harvesting and spurred an 18 percent drop in the amount of cane processed by mills in the second half of May, Unica, an industry group, said yesterday.
“Rains forecast for next week may be helping sugar up today, as they will reduce the sugar content in the cane,” Juliano Ferreira, a broker at ICAP do Brasil Ctvm, said by e- mail today.
Raw sugar for October delivery climbed 2.6 percent to settle at 20.01 cents a pound at 2 p.m. on ICE Futures U.S. in New York, the biggest advance since June 6.
Options contracts, which give the holder to right to buy or sell the futures at a fixed price, for July delivery sugar on ICE expire today. There are about 12,000 outstanding contracts giving holders the right to sell sugar at 20 cents a pound.
“We also have the options expiry today, and with the harvest delayed in Brazil, it may be that traders will try to take a large delivery when the July contract expires,” Ferreira said. “The ones that sold this position will try to defend the price up to 20 cents.”
Arabica-coffee futures for September delivery advanced 0.6 percent to $1.52 a pound on ICE.
Cocoa futures for September delivery declined 0.7 percent to $2,247 a metric ton in New York.
In London futures trading, refined sugar and robusta coffee climbed on NYSE Liffe. Cocoa dropped.
To contact the reporter on this story: Isis Almeida in London at email@example.com
To contact the editor responsible for this story: Claudia Carpenter at firstname.lastname@example.org