Soft futures edge higher

Soft futures advanced during European trading on Monday with robusta and cocoa gaining slightly, while sugar, cotton and arabica marked a moderate rise.

On the NYSE LIFFE, cocoa for July delivery traded at 1 505 pounds per ton at 12:48 GMT, up 0.13% on the day. Prices ranged between days high and low of 1 516 and 1 495 pounds respectively. Cocoa settled 0.4% lower on Friday after advancing for three straight days and closed the week 4.3% higher.

Cocoa advanced recently as ample supply from its main growers is expected. According to the International Cocoa Organization, farmers in Ivory Coast are harvesting the third highest cocoa mid-crop ever, estimated at 440 000 tons. This is the first and smaller of two annual harvests with the second one called main-crop. Lack of rain in Ivory Coast and Ghana spurred concern the main-crop will be delayed. According to Kevin Marcus, founder of the commodity weather consulting company Marcus Weather in Passaic, New Jersey, a large mid-crop slows the development of the main-crop as the tree suppresses its early setting, hindering the development of pods.

Sugar snaps a 6-day losing streak

Sugar advanced today, putting a temporary end to a 6-day losing streak as investors returned to the market amid speculation prices fell too far, seeking cheap valuations. Sugar for October delivery traded at $0.1629 a pound, up 0.25% on the day. Prices ranged between days high and low of $0.1636 and $0.1618. The sweetener fell to a three-week low of $0.1623 on Friday after it declined for six straight days, settling the week 3.9% lower.

Brazil is the worlds biggest producer and exporter, accounting for 20% of global production and 39% of shipments. On Friday, Datargo, a Brazilian industry group, said the countrys main growing region is expected to produce more than 1 million tons of sugar this year, compared to the last one. Output should total around 35.3 million tons, above last years 34.1 million.

Arabica gains

Meanwhile on the ICE Futures U.S. Exchange, arabica futures for September delivery gained 1.06% on the day, trading at $1.2205 a pound. Prices ranged between days high and low of $1.2268 and $1.2025 respectively. The C contract settled 0.3% lower on Friday, but ended the week 0.25% higher after advancing 0.88% the previous one.

The arabica sort was pressured last week as cheaper currencies of main growers spurred sales, pushing prices down. Arabica lost more than 2% on Tuesday as the cheaper Brazilian real gave growers a competitive advantage on the markets, which spurred sales. Growers in Brazil are unloading beans in order to clear storage for the next harvest. The real dropped 9.4% during the second quarter, the most among 24 emerging-market countries, causing the world’s biggest producer to sell more on account of Peru. Peru, the third biggest South America arabica grower, sold 31% less coffee during the first five months of the year as buyers switched to Brazil due to its cheaper currency. Colombia, the second biggest arabica grower, increased its export by 32% as the peso fell 7.1% against the U.S. dollar.

Meanwhile on the NYSE LIFFE, robusta coffee for September delivery also rose, marking a 0.55% daily gain. The coffee stood at $1 817 a ton at 13:06 GMT, ranging between days high and low of $1 829 and $1 796 respectively. It settled 0.66% lower on Friday, pressured by the stronger dollar but closed the week 2.73% higher. Robusta rose to the highest in three weeks on Tuesday amid speculation prices fell last quarter too much, while stockpiles in Europe declined and premiums in growing countries were high. The sort that is mainly grown in Vietnam fell 14% between April and June, which is the worst quarter since Q3 2011. Meanwhile, stockpiles, monitored by the NYSE LIFFE, fell by 1.3% in the two weeks to June 24.

Cotton advances

Cotton also advanced on Monday, trading at $0.8527 a pound at 13:13 GMT. Cotton for December delivery was up 0.28% on the day, ranging between daily high and low of $0.8549 and $0.8464 a pound respectively. The fiber settled 1.00% higher last week after marking a 0.3% decline on Friday.

In its acreage report in the end of June, the U.S. Department of Agriculture said all cotton planted area for 2013 is estimated at 10.3 million acres, 17% below compared to last year. However, the fiber was recently pressured down as concern over a slowdown in demand arose from the world’s biggest consumer, China. All of the country’s PMI readings showed worse readings than the preceding month and it received several downward revisions of its GDP growth forecast, including one from Goldman Sachs, according to which China’s economy will expand by 7.4% in 2013, down from 7.8%.

In its weekly crop progress report on Monday, the USDA said that cotton squaring fell behind last year’s pace with figures standing at 37% as of June 30, compared to 47% last year and below the five-year average of 45%.