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LONDON — Arabica coffee futures on ICE slipped to a three-week low on Wednesday, pressured partly by favorable weather for crop development in top producer Brazil, while raw sugar also fell.
COFFEE
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* March arabica coffee lost 2.2% to $1.6265 per lb by 1418 GMT after dipping to a three-week low of $1.61.
* Dealers said rains in Brazil coffee areas and forecasts for more showers over the next few days should aid crop development.
* The market was also keeping a close watch on economic turmoil in Brazil, with the country’s currency falling to its weakest since July 2021 this week before regaining some ground on Wednesday.
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* However, the market could gain some support in the next few days from index fund buying.
* The weak performance of coffee in 2022 means it has become underweight in some indexes, so there will be some buying to restore the previous balance along with selling of stronger-performing commodities.
* Costa Rican coffee growers exported 11.7% fewer beans in December than in the same month of 2021, the country’s ICAFE coffee institute said on Tuesday.
* March robusta coffee rose 1.1% to $1,872 a tonne.
SUGAR
* March raw sugar fell 0.4% to 19.63 cents per lb.
* Dealers said changes to Brazilian fuel policy under the country’s new president Luiz Inacio Lula de Silva were likely to favor the use of cane to make sugar rather than ethanol.
* They also said that increased output of sugar in India was helping to keep the market on the defensive.
* March white sugar was up 0.1% at $548.50 a tonne.
COCOA
* March New York cocoa rose 1.3% to $2,605 a tonne, boosted partly by a weak dollar.
* March London cocoa was up 0.15% at 2,050 pounds a tonne. (Reporting by Nigel Hunt Editing by Alison Williams and David Goodman )