Cocoa, Coffee, Sugar Fall as Europe’s Crisis Seen Damping Demand
European stocks fell and Italy’s borrowing costs climbed to a three-month high as the country’s elections stalemate spurred concern the continent’s crisis will worsen. Coffee growers in top producer Brazil had sold 67 percent of the crop by Feb. 8, down from 79 percent a year earlier, according to researcher Safras & Mercado. Ivory Coast, the largest cocoa grower, is behind with sales of its crop, said Kona Haque, an analyst at Macquarie Group Ltd. in London. Brazil’s sugar millers have sold less of their crop than usual, Rabobank International estimates.
“The general market sentiment is weighing on prices,” Carsten Fritsch, a commodities analyst at Commerzbank AG in Frankfurt, said by e-mail today. “Stock markets are lower and risk aversion is higher as well.”
Raw sugar for May delivery slid 0.7 percent to 17.97 cents a pound by 6:18 a.m. on ICE Futures U.S. in New York, extending a drop of 0.3 percent yesterday. Arabica coffee for delivery in May was down 1.1 percent to $1.416 a pound and cocoa for May delivery fell 0.9 percent to $2,123 a metric ton.
In London, white sugar for May delivery was 0.3 percent down at $503.80 a ton on NYSE Liffe, while robusta coffee for delivery in May fell 0.5 percent to $2,069 a ton and cocoa for delivery in March declined 1.3 percent to 1,416 pounds ($2,150) a ton, paring a gain of 0.7 percent yesterday.
Early results suggested Italy’s election would produce a hung parliament, possibly leading to another vote. The Standard & Poor’s GSCI gauge of 24 raw materials declined as much as 0.8 percent.
Raw sugar has fallen 7.9 percent so far this year, making it the third-worst performer in the GSCI gauge, as supplies are set to outpace demand for a fourth year, according to F.O. Licht GmbH.
“In our opinion, the sugar price shouldn’t fall any further, and is more likely to respond to negative news with price increases,” Fritsch said.
Brazilian industry group Unica will update harvest progress figures for the 2012-13 season later today.
To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.