Sugar Drops on Accelerating Brazil Harvest; Coffee GainsMarvin G. Perez
Sugar futures fell as the cane harvest accelerates in Brazil, the world’s biggest producer. Coffee rose, while cotton, cocoa and orange juice slid.
In the second half of April, mills in Brazil’s Center South, the top producing area, crushed as much as 29 million metric tons of cane, up from 9.24 million a year earlier, as dry weather allowed processing to accelerate, Michael McDougall, a vice president at Newedge Group in New York, said yesterday in an e-mail. This season, output may climb 11 percent, according to Unica, a Sao Paulo-based industry group.
“Traders are keeping an eye on developments in Brazil and expect big production as the harvest moves forward,” Jack Scoville, a vice president at Price Futures Group in Chicago, said in a report.
Raw sugar for July delivery declined 1 percent to settle at 17.64 cents a pound at 2 p.m. on ICE Futures U.S. in New York. The price has dropped 9.6 percent this year.
Arabica-coffee futures for July delivery rose 0.7 percent to $1.427 a pound, the fourth straight advance and the longest rally since March 26. The price has declined 0.8 percent this year after tumbling 37 percent in 2012.
Brazil, the biggest producer and shipper, raised the minimum domestic price for arabica beans by 17 percent to help boost income for farmers after global prices slumped.
Raising the minimum “may only be a short-term fix to those who see coffee prices too low,” Hector Galvan, a senior commodity broker at RJO Futures in Chicago, said in an e-mail.
Cotton futures for July delivery dropped 0.3 percent to 87.15 cents a pound.
Cocoa futures for July delivery declined 0.2 percent to $2,396 a metric ton.
Orange-juice futures for July delivery fell 1.2 percent to $1.3895 a pound.