By Julie Wernau
Tropical commodities tied to Brazil pushed lower Friday at the Brazilian real weakened against the dollar for the third straight session, encouraging sellers in those markets.
The real has dropped 9% against the dollar since the outcome of the U.S. presidential on Tuesday on concerns that nationalist policies under U.S. president-elect Donald Trump could impact trade.
Brazil is the world's largest producer of orange juice, sugar and coffee and a weaker real allows producers and exporters to recoup more of the local currency for sales of dollar denominated goods.
Arabica coffee for December fell 2% to $1.586 a pound, raw sugar futures fell 0.4% to 21.57 cents apound and frozen concentrated orange juice for January was down 1.2% at $2.146 a pound.
Jack Scoville, vice president of Price Futures Group, said the weak real washed some bullish speculators out of the markets. All three markets had been in a bullish pose leading up to the election with ideas that sugar demand this year will outstrip supply, that lower robusta coffee production will lead to higher demand for arabica and with Florida's orange crop devastated by disease.
Despite the speculator washout, physical coffee prices in Brazil haven't changed much, said Thiago Marques Cazarini, a coffee broker with Cazarini Trading Company in Brazil.
"Producers keep asking unchanged levels as if market hasn't dropped," he said.
In other markets, cocoa for March was up 0.6% at $2,456 a ton and cotton for December lost 1% at 68.50 cents a pound.
Write to Julie Wernau at email@example.com
(END) Dow Jones Newswires
November 11, 2016 11:08 ET (16:08 GMT)
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