Raw Sugar Futures Rebound After Slumping to Four-Week Lows

New York, May 29 (Reuters) - Raw sugar futures on the Intercontinental Exchange (ICE) closed up on Friday following a four-week low on Thursday, with dealers viewing ample near-term supplies as priced in for now. The market experienced a 4.3% loss in the week.

Raw sugar settled at 14.06 cents per pound, an increase of 0.13 cent, or 0.9%. The strong start to the sugar harvest in top grower Brazil has been a contributing factor to the market's volatility. However, broker ADMIS has expressed concerns over the current pace of sugar production in Brazil, stating that it may be too much to ask for the country's sugar production to maintain its current strong pace.

Additionally, concerns over the impact of the monsoon in No. 2 grower India have weighed on the market. India has forecast an El Niño-weakened monsoon in 2026, which is expected to bring the lowest rainfall in 11 years. This has fueled concerns over crops, food prices, and growth in the world's fifth-largest economy.

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Sugar's recovery came despite a drop in oil prices, which are often bullish for sugar as they tempt cane mills to produce more ethanol fuel and less sugar. Higher energy prices can lead to increased production of ethanol, which can negatively impact sugar production.

Coffee Prices Fall Amid Tight Market Conditions

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Arabica coffee settled at $2.656 per pound, a decrease of 8.65 cents, or 3.2%. The market has been tight in the near term due to a drop in coffee exports from No. 2 arabica grower Colombia. However, supplies are expected to improve as an expected bumper harvest in Brazil gets underway.

Certified arabica stocks have continued to fall, hitting the lowest since February at little over 435,000 bags. Robusta coffee fell to $3,501 a ton.

Cocoa Prices Decline Amid Weaker Demand

London cocoa settled at 2,975 pounds per ton, a decrease of 112 pounds, or 3.6%. The market gained 4% in the week. New York cocoa fell to $3,923 a ton. According to Reuters technical analyst Wang Tao, the contract may retrace to $3,919 a ton, as it has broken a support at $4,084.