SOFTS-Arabica coffee soars 10% to 6-1/2 year high on Brazil frosts

Credit: REUTERS/JUAN CARLOS ULATE

Updates prices

LONDON, July 22 (Reuters) - Arabica coffee futures on ICE jumped more than 10% to hit their highest in 6-1/2 years on Thursday as trade houses considered doubling their estimates of the damage to crops in top producer Brazil from this week's frost.

COFFEE

* September arabica coffee KCc1 was up 9% at $1.92 per lb at 1506 GMT, having surged more than 10% at the open to its highest since November 2014 at $1.95. The contract has gained nearly 20% this week.

* Trade houses are scrambling to assess the damage to Brazil's coffee crop from Tuesday's frosts, with earlier bets on 1-2 million bags of losses for next season looking increasingly optimistic, said a source at a global agricultural commodities trader.

* "I think the figures are going to be close to double (that)," he said. "There'll be issues here if you (bought coffee futures) at $1.20-$1.30, issues with (delivery) defaults, it's starting to be whispered," he added.

* The frosts hit Brazil's main coffee-growing region of Minas Gerais and Sao Paulo on Tuesday, with some farmers expecting they will have to take out their trees and replant. L8N2OX5N0

* Coffee trees are extremely sensitive to frost, which kills the leaves, forcing the plant to regrow them the next season, while severe frosts can kill the tree completely.

* September robusta coffee LRCc2 rose 5% to $1,870 a tonne, having hit a 3-1/2 year high of $1,885.

SUGAR

* October raw sugar SBc1 fell 0.4% to 17.60 cents per lb, having closed up 1.5% on Wednesday.

* While frosts also hit some sugar cane areas in Brazil, a top sugar producer, they are thought to have had a minimal impact on the cane as the affected areas had already been harvested.

* Still dealers said unless macro economic factors turn decidedly negative, sugar is biased to the upside as Brazil production estimates will likely be lowered in the coming weeks thanks to an earlier frost and drought.

* October white sugar LSUc1 fell 1% to $446.10 a tonne.

COCOA

* September London cocoa LCCc1 rose 0.3% to 1,574 pounds a tonne, having hit its lowest in a year last week.

* September New York cocoa CCc1 ​rose 2% to $2,310 a tonne.

(Editing by Mark Potter and David Goodman )

((maytaal.angel@thomsonreuters.com(00442075429105)(Reuters Messaging: maytaal.angel.thomsonreuters.com@reuters.net) ))

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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