LONDON, Dec 28 (Reuters) - ICE raw sugar futures hovered around three-week highs on book-squaring, and robusta coffee eased to a two-month low due to hedging, while arabica coffee and cocoa were steady in holiday-thinned volumes on Wednesday.
ICE raw sugar futures firmed on light investor buying and book-squaring, trading around a three-week peak, with potential upside in prices pressured by big crops in the EU, Russia, Ukraine, India and Thailand.
"We may be seeing some book-squaring, but volumes are quite low. Our discussions are focused on the big supplies coming through to the world market - how much sugar and when it will be available," a London-based sugar broker said.
The raw sugar market is on track to be the third worst performing commodity in 2011, having fallen sharply since reaching a 30-year peak around 36 cents a lb earlier in the year.
Thai raw sugar premiums hardly moved this week and Indian whites were unchanged at around $600 as physical trading slowed to a trickle ahead of year-end holidays, but sellers still noted inquiries for nearby shipment, dealers said on Tuesday.
Russia refined a record 4.56 million tonnes of white sugar from beet from the start of the season in August to Dec. 26, but weather has slowed production, the Russian Sugar Producers' Union industry lobby said on Wednesday.
ICE March raw sugar futures were up 0.09 cent or 0.4 percent to 23.70 cents a lb at 1116 GMT.
London March white sugar futures were up $3.00 or 0.5 percent to $614.20 per tonne in thin volume of 578 lots.
Arabica coffee futures on ICE dipped slightly on investor selling in light, holiday-thinned volumes, trading above a one-year trough touched earlier this month.
Coffee was seen as bullish due to weather-related problems in major producer Colombia.
ICE May arabica futures were down 1.2 cent or 0.5 percent to $2.2440 per lb at 1106 GMT. On Dec. 19 the second position contract fell to a one-year low of $2.1235 per lb, pressured by concerns over the euro zone crisis and worries over the global economic outlook.
London March robusta coffee futures traded down to a two-month low, basis second month, weighed by hedging against a big harvest in top producer Vietnam.
"There is a bit of hedging pressure coming to the market," one robusta coffee futures broker said.
"There is also some good volume on structural trades in January-March positions," the broker added, referring to rolling of positions in robusta coffee futures.
London March futures were down $35 or 1.9 percent to $1,796 per tonne, having earlier touched a contract low of $1,793 per tonne, a two-month low basis second month.
Dealers waited for NYSE Liffe's Commitments of Traders report, due to be released later in the session.
Vietnam exported an estimated 150,000 tonnes, or 2.5 million bags, of coffee in December, a drop of 8.5 percent from the same month last year, the government said on Wednesday.
Global coffee prices may surge early next year as tighter bank lending in top robusta producer Vietnam chokes off cash to exporters, cutting supply and pushing up premiums even as the harvest rolls in.
ABUNDANT COCOA
ICE cocoa futures were little changed in low volumes, pressured by ample West African supplies.
ICE May cocoa was up $11 or 0.5 percent to $2,248 per tonne in thin volume of 331 lots.
London March cocoa was up 13 pounds or 0.9 percent to 1,420 pounds per tonne in light turnover of 1,362 lots.
Prolonged drought mixed with the dry harmattan wind last week in most of Ivory Coast's cocoa regions could reduce the size and hamper the quality of Ivorian main cocoa crop, farmers said on Tuesday. (Reporting by David Brough; Editing by William Hardy)
