BLBG:Sugar, Coffee Extend Slumps To Lowest Since 2010; Cocoa Declines
Sugar and coffee futures extended slumps to the lowest since 2010 on concern that the sluggish global economy will curb demand for raw materials. Cocoa also declined.
In May, U.S. employers added the fewest workers in a year, while the unemployment rate unexpectedly climbed to 8.2 percent, and a drop in China’s manufacturing led declines across Asia, reports showed today. The Standard & Poor’s GSCI Spot Index of 24 raw materials fell to the lowest in almost eight months, led by energy.
“Basically, the reaction is to the weak unemployment data in the U.S. and manufacturing in China,” Jack Scoville, a vice president at Price Futures Group in Chicago, said in a telephone interview. “There’s no reason to be bullish.’
Raw sugar for July delivery declined 1.7 percent to settle at 19.09 cents a pound 2 p.m. on ICE Futures U.S. in New York, after touching 18.95 cents, the lowest for a most-active contract since Aug. 17, 2010. The price dropped 2.7 percent this week.
Arabica-coffee futures for July delivery fell 2 percent to $1.575 a pound in New York, after touching $1.565, the lowest since July 21, 2010. This week, the price dropped 6.1 percent.
“It will be hard to find fund activity on the long side of the market,” Sterling Smith, a commodity analyst at Citigroup Inc.’s institutional client group in Chicago, said in a telephone interview “If anything, they are going to go short or take money off the table.”
Cocoa futures for July delivery fell 1 percent to $2,063 a metric ton on ICE. Earlier, the price touched $2,026, the lowest since Jan. 9. This week, the commodity dropped 2.2 percent, the third straight decline and the longest slump since December.
In London futures trading, refined sugar, robusta coffee and cocoa also tumbled on NYSE Liffe.
To contact the reporter on this story: Marvin G. Perez in New York at mperez71@bloomberg.net
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
