December 20, 2018 / 7:29 PM / 6 months ago

SOFTS-Cocoa pulls back from six-week highs; arabica coffee climbs

 (Recasts with updated prices, comments; adds NEW YORK to
    NEW YORK/LONDON, Dec 20 (Reuters) - Cocoa futures on ICE
fell on Thursday, erasing the prior session's gains when they
hit six-week highs, while the Brazilian real boosted arabica
coffee prices and lower oil prices pressured raw sugar. 
    * March New York cocoa        settled down $46, or 2
percent, at $2,271 per tonne, after rising 2 percent in the
previous session.
    * "We need to close above $2,290 for a couple more days to
get convinced that the trend in cocoa has changed," one U.S.
trader said. The $2,290 level represents a 62 percent Fibonacci
retracement in the March contract from the Nov. 7 high of $2,410
to the Dec. 5 low of $2,095, the trader noted. 
    * March London cocoa         settled down 24 pounds, or 1.4
percent, at 1,685 pounds per tonne as the pound strengthened.
    * "With the thin trading conditions, moves in cocoa have
certainly been more magnified than is perhaps justified," said
one European dealer.
    * Still, market participants continued to monitor the
weather in West Africa amid worries that excessive dryness
during the annual Harmattan could curb output.    

    * March arabica coffee        settled up 1.65 cent, or 1.6
percent, at $1.025 per lb. 
    * Prices were supported by a rally in the currency of
top-producer Brazil.        
    * A stronger currency discourages producer selling by
reducing local returns on dollar-traded commodities like coffee
and sugar. 
    * Prices hit a three-month low of 99.20 cents on Tuesday.
Since then, they have recovered from technically oversold
conditions on the relative strength index. 
    * Brazil is expected to produce 63.7 million 60-kilo bags of
coffee in 2018-19 season, up over 5 percent on a previous
estimate, consultancy Safras & Mercados said.             
    * March robusta coffee         settled up $17, or 1.13
percent, at $1,524 per tonne. 

    * March raw sugar        settled down 0.04 cent, or 0.3
percent, at 12.43 cents per lb.
    * Prices have closed lower in four of the past five
sessions, and on Tuesday fell to a 2-1/2-month low of 12.26
cents per lb. 
    * Brazil's center-south region crushed 12.6 million tonnes
of cane in the first half of December, producing 408,300 tonnes
of sugar, industry group UNICA said on Thursday.             
    * Crushing in Brazil's main sugarcane producing region for
the 2019-20 season should roughly match this year's production,
as planted area shrinks but yields improve, analysts said.
    * March white sugar         settled down $1.60, or 0.5
percent, at $339.40 per tonne.

 (Reporting by Ayenat Mersie in New York and Ana Ionova in
London; Editing by Susan Fenton/David Evans/Jane Merriman/Dan
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