Robusta coffee hits record high, arabica at more than 1-1/2 year high

Robusta coffee futures on ICE hit record highs for a fifth straight day on Wednesday amid worries over Vietnam supplies, while arabica hit its highest in more than 1-1/2 years.

Cocoa resumed its rally, but had yet to regain record peaks after Tuesday's slide.

COFFEE

* July robusta coffee RC2! rose 4.2% to $4,143 a metric ton at 1529 GMT, after earlier hitting $4,167.

* Dealers described the market in top producer Vietnam as inactive, with farmers holding onto stock despite the record highs, as they expect even higher prices.

* There are also concerns over Vietnam's weather, they said, as April rainfall has so far closely tracked 2016, when dry conditions resulted in a production drop of 8.6%.

* July arabica coffee KC2! rose 3.8% to $2.3715 per lb, its highest since late August 2022.

* "Arabica may be experiencing a spillover effect from the recent robusta rally and the ongoing Red Sea crisis," said Rabobank in a note.

* Arabica and robusta are fungible to an extent, as coffee is traditionally a blend.

COCOA

* July London cocoa C2! rose 3.6% to 8,644 pounds per ton after hitting a record 9,025 pounds on Tuesday before closing down nearly 6%.

* First-quarter cocoa grind data for Europe and North America is due on Thursday.

* Dealers said any fall would mainly be seen as a reflection of a shortage of beans rather than an indication that high prices are beginning to curb demand.

* Nonetheless, they expect declines of between 3% and 6% for Europe, 8% for north America and 8% for Asia.

* July New York cocoa CC2! rose 3.2% to $10,129 a ton, having slid 7% at the close on Tuesday.

SUGAR

* May raw sugar SB1! fell 1.8% to 19.28 cents per lb, after touching a 16-month low of 19.27 cents.

* Stronger-than-expected sugar production in India and Thailand have put the market on the defensive.

* Recent rain in Brazil has also improved the outlook for cane production in the 2024/25 season.

* August white sugar SF1! fell 2% to $558.80 a ton.