Raw sugar futures on ICE crept higher for most of the session, following a surge in open interest in the previous session, but turned lower late in the session on fund selling, giving back the previous session's steep gains. The Thomson Reuters-Jefferies CRB index, a global benchmark for commodities, fell about 0.8 percent as weak manufacturing data and tense US budget talks stoked worries about the world economy. Cocoa futures gave back their previous week's gains, extending losses late in the session as investors were seen taking profits, dealers said. Benchmark Liffe March cocoa futures dropped 43 pounds, or 2.7 percent, to settle at 1,548 pounds a tonne, the lowest settlement for the second position since November 12 and not far above the 200-day moving average at 1,538 pounds.
Dealers eyed the widening premium which closed at 46 pounds, the biggest since July 4, up from 12 pounds at Monday's close. "When you get to this stage of any delivery the focus is how much graded cocoa is available," said Jonathan Parkman, joint head of Agriculture at Marex Financial.
A large quantity of non-tenderable stock of 16,168 tonnes, which has failed grading on the Liffe exchange, was eyed by dealers with valid cocoa stocks in NYSE Liffe's nominated warehouses falling to 49,170 tonnes as of November 26. Cocoa futures on ICE also sank, with March closing down $75, or 3 percent, at $2,444 a tonne, extending losses after falling below the 100-day moving average at $2,450. Open interest in ICE cocoa futures climbed for the ninth straight day on December 3 when it reached 202,902 lots, up nearly 4,000 lots from the previous session. The record high is 207,128 lots, ICE data showed.
Speculators are holding a large net long position on both ICE and Liffe cocoa markets. March arabica coffee futures finished down 2.35 cents, or 1.6 percent, at $1.4835 per lb, having hit a session low at $1.4710, a double bottom with the 2-1/2-year low hit last week.
"Trade is very technical at the moment. There's a feeling that we need fresh impetus on either the technical or the fundamental front," Andrea Thompson, analyst at Coffee Network, part of INTL FCStone, told Reuters. March robusta coffee futures settled down $29, or 1.5 percent, at $1,881 a tonne. March raw sugar futures on ICE settled down 0.31 cent, or 1.6 percent, at 19.44 cents a lb, having traded in a range from 19.36-19.90 cents.
Open interest soared in the previous session, jumping 12,824 lots to 760,615 lots, highest since June 15, exchange data showed. March white sugar on Liffe also turned lower, closing down $5.30, or 1 percent, at $518.10 per tonne.