Sugar dropped the most in a week on speculation that expanded processing of cane in Brazil, the world’s top producer, will compound a global surplus of the sweetener. Cocoa, orange juice and cotton rose. Coffee slid.
Cane crushing in Brazil’s Center South, the top growing region, totaled 315.1 million metric tons since the start of the crop year on April 1 to Aug. 15, up 54 million tons, or 21 percent, from the same period last year, according to Unica, an industry group. By the end of September, the gap over 2012 output may widen to more than 65 million tons as the harvest accelerates, James Cassidy, head of the sugar-trading desk at Newedge Group in New York, said in an e-mailed report.
“There is a lot of sugar, and the supply-side fundamentals seem to overwhelm any demand-side strength over time,” Jack Scoville, a vice president at Price Futures Group Inc. in Chicago, said in an e-mailed report.
Raw sugar for delivery in October declined 0.5 percent to settle at 16.38 cents a pound at 2 p.m. on ICE Futures U.S. in New York, the biggest drop since Aug. 27. Prices are down 16 percent this year.
Cocoa futures for delivery in December advanced 3.2 percent to $2,496 a ton on ICE, the largest gain since Aug. 5.
While parts of Ivory Coast and Ghana, the world’s top cocoa growers, will get some rainfall in the next five days, precipitation was about half average levels in the past month, according to MDA Weather Services.
Rains “are not enough to make up for soil moisture losses, which will likely bring down cocoa yields,” Hector Galvan, a commodities broker at RJO Futures in Chicago, wrote in an e-mail. “The trade is likely looking at the possibility of less supplies.”
Orange-juice futures for November delivery added 0.5 percent to $1.332 a pound in New York. Cotton futures for December delivery rose less than 0.1 percent to 82.75 cents a pound. Arabica-coffee futures for December delivery slid 0.3 percent to $1.1685 a pound.