OREANDA-NEWS. February 12, 2015. Raw sugar futures on ICE were steady on Wednesday in spread trade ahead of a contract expiry, although prices were underpinned by physical buying, while arabica coffee edged higher, with upside limited by a firm dollar.

New York cocoa futures were little changed, consolidating after a rally from a one-year low touched on Feb. 2. ICE March raw sugar futures traded flat at 14.71 cents per lb at 1518 GMT.

"For now I would think that as long as the dollar remains strong and the real continues to weaken, that lower prices are more likely to be seen," a London-based broker said. The March/May spread traded at a 0.08 cent premium, up from a 0.06 cent discount at Friday's settlement, as China was seen buying spot sugar in Brazil and there was talk of China buying Central American sugar.

"With low freight rates, Guatemala is exporting sugar in Asia. And there is more to come from Guatemala," said Claudiu Covrig, senior agricultural analyst with Platts Kingsman.

The spread trading boosted total volume, as index funds rolled their positions forward.

The March contract will expire on Feb. 27. "The spreads are showing bullish signals as the trade seem to be suggesting there is tightness in the (Brazil) inter-crop period," Thomas Kujawa, co-head of the softs desk at Sucden Financial Sugar, said.

March white sugar futures slipped \\$3.80, or 1 percent, at \\$380.00 per tonne ahead of expiry on Friday. Dealers said they expected a small quantity of Central American white sugar to be delivered against the expiry.

Arabica coffee firmed on chart-based buying and risked triggering producer selling, due to a weak Brazilian real against the dollar which boosts local currency returns to Brazilian producers.

March arabica coffee futures traded up 0.75 cents, or 0.5 percent, at \\$1.6015 per lb. May robusta coffee was down \\$8, or 0.4 percent, at \\$1,963 a tonne.

Most-active May New York cocoa on ICE was down \\$2, or 0.07 percent, at \\$2,866 a tonne.

Jonathan Parkman, joint head of agriculture at broker Marex Spectron, said cocoa traders focused on brisk arrivals from top grower Ivory Coast and weak purchase data from number 2 grower Ghana.

May London cocoa futures were down 1 pound, or 0.05 percent, at 1,966 pounds a tonne.