* Fighting rages on in top cocoa producer Ivory Coast
* EU sanctions lifting seen as a step in right direction
* Arabicas supported by tight supplies
* ICE and Liffe sugar approach contract expiries
(Adds trade comment, bylines, updates prices)
By David Brough and Sarah McFarlane
LONDON, April 11 (Reuters) - ICE cocoa futures extended gains on Monday on concerns over the supply outlook from top producer Ivory Coast despite the lifting of European Union sanctions on four entities.
Coffee futures prices dipped on light producer selling, while sugar rose on investor buying, as dealers eyed the expiry of the London and ICE spot contracts later this month.
In cocoa, the EU lifted sanctions on Friday on Abidjan and San Pedro ports as well as on the Ivorian Refining Company and the Coffee and Cocoa Trade Management Committee, following a request from presidential claimant Alassane Ouattara.
However, fighting between forces loyal to Ouattara and incumbent Ivory Coast leader Laurent Gbagbo continued in the commercial capital Abidjan.
U.N. and French helicopters attacked forces loyal to Gbagbo, damaging the presidential residence in Abidjan and destroying heavy weapons after U.N. chief Ban Ki-moon ordered them silenced.
Dealers and analysts said physical cocoa was unlikely to flow from Ivory Coast until the fighting stops and the banking system is restored, despite the EU sanctions move. Ivory Coast accounts for about 40 percent of world supplies.
"Getting the banking system up and running is the key," said a European analyst with a leading trade house.
"Nothing will start moving until the banks are back operating. Until you can pay for goods, nothing will really move. How quickly this will happen is very hard to predict."
ICE second-month, July cocoa was up $47 or 1.6 percent to $3,032 per tonne in modest volume of 1,026 lots at 1053 GMT, below the 32-year high of $3,775 per tonne touched on March 4.
London second-month, July cocoa was up 31 pounds or 1.6 percent to 1,920 pounds ($3,142) per tonne in moderate turnover of 1,689 lots.
Coffee prices eased, stuck within a tight range as dealers said light producer selling weighed and prices remained below the 34-year high of $2.9665 a lb touched on March 9.
"Prices will struggle to push up too high again because you've got a lot of producer selling coming over the next few months ... prices above $2.70 a lb are encouraging producer selling," said a London-based broker.
ICE July arabica coffee fell 2.35 cents or 0.85 percent to $2.7550 per lb at 1055 GMT.
ICE coffee prices rose over 5 percent last week, triggering producer selling, to peak at $2.8125 a lb on Friday, their highest since March 11.
"Over the last two weeks the coffee markets have been so volatile, it's been more technical than fundamental," the broker said.
Liffe July robustas were down $18 or 0.7 percent to $2,429 a tonne in modest volume of 1,766 lots.
SUGAR EXPIRIES
Sugar futures rose on options-related buying as dealers focused on expiry of the London May white sugar contract on April 15 and of the ICE May raw sugar futures contract on April 29. Options expiry on the May New York contract takes place on Friday.
Dealers talked of delays in harvesting of the cane crop in the centre-south of Brazil, low global stocks and larger-than-expected production in Thailand
ICE May raw sugar futures rose 0.26 cent or 1 percent to 26.92 cents a lb at 1056 GMT.
London May white sugar rose $1.60 or 0.2 percent to $701.30 per tonne in light volume of 2,088 lots. (Editing by Jane Baird)