ICE sugar and coffee futures were steadied with help from a softer dollar yesterday, after sharp slides the previous day, while cocoa firmed although potential for further rises was limited by abundant West African supplies.
ICE benchmark raw sugar futures rose 0.24 cent or 1 per cent to 23.37 cents a pound at 1223 GMT, still below a seven-week peak of 24.65 cents per pound touched on Wednesday.
Sugar futures sank more than 5 per cent on Thursday after hitting a wave of sell-stops.
"This extremely rapid slump points to selling by money managers, no doubt partly on the back of the very firm US dollar and compounded by news of expected rainfall in the Brazilian sugarcane plantations," Commerzbank said in a daily market report. Brazil is the world's top sugar producer.
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Some dealers cited talk of index fund re-weighting in sugar, expected to start on Monday, which should result in net buying of the sweetener. Dealers said the market expected index funds to boost weightings of sugar after last year's price slide.
Potential upside curbed
Potential upside in sugar prices was limited by big crops in the EU, Russia, Ukraine, India and Thailand.
"There still seems little in the medium to long term story for the bulls out there fundamentally speaking as the northern hemisphere and particularly India and Thailand seemed destined to halt a significant rally," said Thomas Kujawa of broker Sucden Financial.