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Soft futures mixed; sugar trades near 1-month low

Published 03/19/2014, 08:55 AM
Sugar trades near 1-month low with Brazil crop in focus
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Investing.com - U.S. soft futures were mixed on Wednesday, with sugar prices trading near a one-month low as investors continued to monitor crop prospects in Brazil.

On the ICE Futures U.S. Exchange, sugar futures for May delivery held in a range between $0.1710 a pound and $0.1726 a pound.

Sugar last traded at $0.1710 a pound during U.S. morning hours, down 0.38%.

The May sugar contract fell to $0.1693 a pound on Tuesday, the weakest level since February 21, before turning higher to settle at $0.1714 a pound.

Market players remained focused on the extent of damage to Brazil's crop prospects from dry weather earlier this year.

Sugar rallied to a four-month high of $0.1846 a pound on March 6, amid speculation dry weather in Brazil will cut this year’s cane crop.

Brazil is the world's largest sugar producer and exporter, with the U.S. Department of Agriculture estimating the nation accounts for nearly 20% of global production and 39% of global sugar exports.

Meanwhile, Arabica coffee for May delivery inched up 0.07% to trade at $1.9190 a pound. Arabica prices added 0.08% on Tuesday to settle at $1.9155 a pound.

Arabica prices hit a two-year high of $2.0975 a pound on March 12 as drought conditions in key coffee-growing regions in Brazil was expected to curb output.

However, Brazil’s coffee export association Cecafe said last week that ample coffee stocks from the last harvest will allow the nation's exports to increase 6% this year and help ease the effects of a severe drought.

According to Cecafe, Brazil is expected to export a total of 33 million 60-kilogram bags in 2014, up from 31.1 million last season.

Elsewhere, cotton futures for May delivery eased down 0.01% to trade at $0.9293 a pound. The May cotton contract rallied 0.98% on Tuesday to settle at $0.9293 a pound.

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