Sugar settles higher on hurricane worries in Cuba

NEW YORK/LONDON — Raw sugar futures on ICE settled up on Monday on worries that the crop was damaged in Cuba by hurricane Irma over the weekend.

Arabica coffee settled higher as concerns about dry weather continued in top-grower Brazil.

October raw sugar settled up 0.20 cent, or 1.40%, at 14.29 cents per pound.

December white sugar settled up $2.60, or 0.70%, at $378.30 per ton, after dropping to its lowest since Aug. 23.

Concerns about the impact of hurricane Irma on the sugar crop in Cuba drove prices up, said Michael McDougall, director of commodities for Societe Generale. “It’s going to take some time to assess crop damage. But it’s still early, so the question is ‘can they repair it before harvest,’” he added.

Prices dropped to 13.80 cents per pound (/ lb) in early trade, likely because of fund-selling, Mr. McDougall said.

World sugar prices are now seen as below ethanol parity in top-grower Brazil, which should convince mills to switch more of their production away from the sweetener, dealers said.

The market shrugged off a stronger dollar index, said Nick Gentile, managing partner of NickJen Capital in New York. A stronger greenback would typically lead to weakening foreign demand.

COFFEE

December arabica coffee settled up 1.20 cent, or 0.92%, at $1.3185/ lb, while November robusta coffee settled down $9, or 0.50%, at $1,951 per ton.

The September contract, which is in a delivery period, settled down $7, or 0.40%, at $1,972 a ton.

December New York cocoa settled up $ 1, or 0.05%, at $1,934 per ton, while December London cocoa settled down £1, or 0.07%, at £1,476 per ton.

Improving demand — mainly in Europe and Asia — boosted prices, said Peter Mooses, senior market strategist at RJO Futures in Chicago. —