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Soft futures mixed; sugar extends losses to hit 4-week low

Published 03/18/2014, 08:46 AM
Updated 03/18/2014, 08:46 AM
Sugar extends losses to hit 4-week low

Investing.com - U.S. soft futures were mixed on Tuesday, with sugar prices extending losses from the previous session to hit the lowest level in nearly a month.

On the ICE Futures U.S. Exchange, sugar futures for May delivery fell to a daily low of $0.1694 a pound, the weakest level since February 21, before recovering to trade at $0.1701 a pound during U.S. morning hours, down 0.35%.

The May sugar contract lost 1.16% on Monday to settle at $0.1705 a pound.

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 rallied 1.65% to trade at $1.9415 a pound. Arabica prices tumbled 3.53% on Monday to settle at $1.9140 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 picked up 0.7% to trade at $0.9268 a pound. The May cotton contract shed 0.17% on Monday to settle at $0.9203 a pound.

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