By Julie Wernau
Tropical commodities tied to Brazil pushed lower Friday as the Brazilian real weakened against the dollar for the third straight session, encouraging sellers in those markets.
The real has dropped 6.5% against the dollar since the outcome of the U.S. presidential election Tuesday on concerns that nationalist policies under President-elect Donald Trump could hurt trade, with the Brazilian central bank intervening two days in a row to prop up the currency.
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 coffeefor December fell 1.5% to end at $1.5945 a pound. Raw sugar futures fell to 21.50 cents a pound at one point but recovered losses as high prices in China boosted expectations that the country will increase imports. The March contract ended up 0.2% at 21.70 cents a pound.
Frozen concentrated orange juice for January was down 2.4% to close at $2.1195 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 firstname.lastname@example.org
(END) Dow Jones Newswires
November 11, 2016 17:34 ET (22:34 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.