But talk that the extent of the drought-damage to the country’s 2014-2015 crop may not be as great as initially feared has pressured futures prices in recent weeks. The country’s arabica harvest starts to gather pace in June and it will be only near the end of the harvest in about September that the extent of the weather-damage to the crop will become clear.
Robusta coffee for July delivery on NYSE Liffe on May 27 touched a low of $1,903 a tonne, the weakest for the second-month contract since February, before settling at $1,907. The following day, July robusta finished $1 higher at $1,908 a tonne. Vietnam, the top producer and exporter of the robusta variety of coffee, has seen a big crop with March exports at a reported record 2.9 million 60-kg bags.
Raw sugar futures also headed lower, pressured by big surpluses of the sweetener around the globe. The ICE July raw sugar contract touched a one-month low of 16.95 cents a pound on May 27 after Brazil’s sugar cane industry association, Unica, reported harvesting in the country’s main sugar-growing region, the Center-South, was gathering pace after a slow start. By midweek, the July contract settled at 17.15 cents a pound, clawing back some of the previous day’s losses.
Worries about the possible damage to Brazil’s sugar crop as a result of the extraordinary weather conditions in the country’s main southern cane-growing areas earlier this year took raw sugar futures on ICE to a four-month high of 18.47 cents on Mar. 6. Earlier this month, the sweetener gained some renewed upward traction. July raw sugar on ICE revisited 18.28 cents a pound on May 14 after Unica reported the lower sugar output for the Center-South region in the 2014-2015 sugar year through to April 30.
White, or refined, sugar on NYSE Liffe was also lower, finishing at $467.10 a tonne on May 28.
Palladium nears 3-year high
Palladium continued its rally this week while platinum futures touched a two-week low as the mine strike in South Africa dragged on into its nineteenth week. South Africa’s newly appointed Mineral Resources Minister, Ngoako Ramathlodi , has stepped in now in an effort to find a solution that has cost the three affected producers more than R20 billion ($1.9 billion) in lost revenue and employees close to R9 billion in lost earnings.
The minister has set up an intergovernmental technical team, with representatives from the departments of Mineral Resources, Labour and National Treasury, to support the Labour Court mediated talks between Anglo American Platinum (Amplats), Impala Platinum (Implats) and Lonmin and the Association of Mineworkers and Construction Union (Amcu)
The Labour Court-mediated talks stalled on May 28 but resumed May 29 with the help of the new intergovernmental technical team .
Palladium for September delivery touched $844.65 an ounce on the Comex division of New York’s Mercantile Exchange (Nymex) on May 28, the highest price for an actively traded contract (currently September) since Aug 1, 2011, before settling at $840.75. Platinum for July delivery on Comex, meanwhile, settled at $1,462.70 an ounce after touching a two-week low of $1,442.70 earlier in the day.
The platinum group metals’ (pgms) response to the South African strike which has seen a large part of the three producers’ mining operations halted since Jan. 23 has been largely muted. Much of the upward rally in palladium futures, which have gained more than 12 percent since the start of the labour dispute, has been due to worries over a potential disruption to Russian export flows of the precious metal amid geopolitical tensions over Russia’s involvement in Ukraine since early March.
