OREANDA-NEWS. February 06, 2015. Raw sugar futures on ICE dipped on Thursday in heavy spreading that shrank the spot contract's discount to its smallest in 11 months under pressure from high stocks and on talk that India could soon launch raw sugar export incentives.

Cocoa rose for a third straight day as the New York market climbed further away from Monday's one-year low, while coffee futures dropped in choppy dealings.

Raw sugar futures eased, with March settling down 0.04 cent, or 0.3 percent, at 14.41 cents a lb. Total open interest rose for the seventh straight day on Feb. 4 to the highest in nearly five months.

The March/May spread narrowed by as much as 0.14 cent, bringing the March contract to a 0.08 discount to May, the smallest since March 2014.

"The buyers are lined up to buy that spread," said Nick Gentile, managing partner of commodity trading advisor NickJen Capital in New York. The New York March raw sugar contract expires on Feb. 27. London March white sugar expires on Feb. 13.

"Now that the speculative position is near flat, talk will center on availability for the expiries and whether there is any receiver(s) prepared to take the sugar up," said Nick Penney, senior trader with Sucden Financial Sugar.

March white sugar futures closed down 80 cents, or 0.2 percent, at \\\$378.50 per tonne. "Sentiment over the expected approval of Indian raw sugar export incentives will keep a cap on the market," a senior trade source said.

Cocoa turned higher, trading within the prior session's large ranges.

March New York cocoa on ICE finished up \\\$19, or 0.7 percent, at \\\$2,743 a tonne. March/May spreading continued to boost volume ahead of the spot contract's first notice day Feb. 13. "Crop development in Ghana may have had a slight downturn," one London-based dealer said, providing a reason for the rise.

Benchmark May London cocoa futures ended up 15 pounds, or 0.8 percent, at 1,908 pounds a tonne. March arabica coffee dipped 0.15 cent, or 0.1 percent, to end at \\\$1.6475 per lb. "You get some meteorologists that are putting out sufficient rains (in Brazil) and you have others saying it's not enough," Gentile said.

"I'm afraid to sell it but I'm also afraid to buy it, so I do nothing." May robusta coffee futures closed down \\\$7, or 0.4 percent, at \\\$1,954 a tonne.