Sugar futures on ICE rallied on Friday as dealers set aside falling oil prices to focus on Europe's record-breaking heatwave and on fears the El Nino weather pattern might hammer output.

Cocoa posted huge weekly gains, with New York cocoa futures gaining 20%.

SUGAR

  • Raw sugar ICEUS:SB1! ​​​settled up 0.43 cent, or 3.2%, at 13.98 cents per lb, having hit a 2-1/2 week high of 14.09 cents. The market gained 2.8% weekly.

  • "We are finding support in the market (from) the weather situation in India, Europe, Thailand, Florida and elsewhere," said senior sugar analyst and consultant Michael McDougall.

  • He noted the current heatwave in Europe has been recognised as the worst on record, the monsoon rains in India are down 42%, Thailand is hot and dry while the cane in Florida is infested with mealybugs.

  • Limiting losses in sugar all the same are weaker energy prices, which raise the prospect that more cane will be used to produce sugar rather than the biofuel ethanol.

  • White sugar ICEUS:SF1! rose 4.3%, at $464.00 a metric ton, having hit a near three-month high of $466. It gained 5.2% in the week, as the problems in Europe affect the whites market harder.

COFFEE

  • Robusta coffee ICEEUR:RC2! settled down $35, or 1%, at $3,627 a ton, having hit a three-month high of $3,692 on Thursday.

  • "El Niño presents a key upside risk to robusta prices through its potential to bring hotter and drier conditions across Southeast Asia and India," said Rabobank in a note.

  • Arabica coffee ICEUS:KC1! fell 1.2% to $2.732 per lb, having hit a near six-week high of $2.8480 per lb on Wednesday.

  • Recent El-Nino-linked rains in Brazil have led to some quality issues and slowed harvest progress, though overall, the world's top arabica grower is still expected to produce a bumper harvest this season.

  • Soft commodities analyst Judith Ganes said the weather in the Brazilian coffee belt is set to clear for at least the next 10 days, helping the harvest.

COCOA

  • London cocoa ICEEUR:C2! ​settled down £112, or 2.8%, at £3,820 per ton, having set a five-month high of £4,014 on Thursday. The London market gained 16% in the week.

  • New York cocoa ICEUS:CC1! fell 2.9% to $5,095 a ton. The market gained 20% weekly.

  • Rabobank said cocoa is being driven by "the transition toward an active El Niño event, easing geopolitical tensions in the Middle East, and a slow start to the development of West Africa’s 2026/27 main crop".

  • The bank, however, still anticipates a surplus in 2026/27 and views El Niño risk premiums as somewhat overpriced.