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Markets

Soft futures mixed; Sugar higher ahead of July expiration

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Investing.com - U.S. soft futures were mixed on Monday, with sugar prices trading higher as investors readjusted positions ahead of the expiration of the front-month July contract.

Contract expiration often leads to volatile sessions as market participants look to close out positions or reposition their portfolios.

On the ICE Futures U.S. Exchange, sugar futures for October delivery traded at USD0.1701 a pound, up 0.6% on the day. The October contract traded in a range between USD0.1692 a pound, the daily low and a session high of USD0.1704 a pound.

Sugar prices hit an six-week high of USD0.1748 a pound on June 25, amid concerns sugar growers in Brazil's center south-region will use more cane to make ethanol as prices for the sweetener tumble.

Brazil is the world's largest sugar producer and exporter, with the U.S. Department of Agriculture estimating the nation accounts for nearly 20% of global production and 39% of global sugar exports.

Meanwhile, Arabica coffee for September delivery traded at USD1.2105 a pound, up 0.5% on the day. The September contract traded in a range between USD1.2013 a pound, the daily low and a session high of USD1.2133 a pound.

Coffee prices fell to a three-year low of USD1.1717 a pound on June 20.

The coffee market has been under heavy selling pressure in recent weeks as traders eyed a huge harvest in top grower Brazil.

Some technical selling also weighed after prices broke below key support levels, triggering a flurry of automatic sell orders amid bearish chart signals.

Elsewhere, cotton futures for December delivery traded at USD0.8335 a pound, down 0.8% on the day. The December contract held in a range between USD0.8332 a pound, the daily low and a session high of USD0.8430 a pound.

Cotton futures fell to a three-week low of USD0.8305 a pound on June 25.

Prices of the fiber have been on a downward trend in recent sessions amid mounting concerns over a slowdown in demand from top consumer China.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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