SOFTS-Raw sugar hits one-month low as dollar, increased supply weigh

LONDON, Dec 18 (Reuters) - Raw sugar futures on the ICE exchange hit their lowest in more than a month on Thursday as dealers eyed a stronger dollar and improved supply prospects.

SUGAR

Raw sugar SBc1 fell 2.4% to 14.41 cents per lb at 1615 GMT, having hit a more than one-month low of 14.58. The contract is reversing some of the gains seen since it hit 5-year lows in November.

The dollar has been rising versus the Brazilian real BRL=, encouraging exporters in the world's top sugar producer to sell by raising returns in local currency terms.

Also, sugar output in No. 2 producer India is projected to rise 18% in the 2025/26 season, and the government will manage the excess by allowing exports.

The EU is creeping closer meanwhile to sealing a contentious free trade pact with South American bloc Mercosur . Challenges remain, however, with critics like Poland and Hungary fearing increased imports of commodities like sugar.

Broker StoneX said the feeling in sugar overall is that when the front month contract expires in two months time, the sweetener will have already seen the floor.

"Not because the scenario has turned bullish, but because sugar seems close to a level where sellers lose interest and buyers start to react more to headline risk," the broker explained.

White sugar LSUc1 fell 1.6% to $415.60 a ton.

COFFEE

Arabica coffee KCc2 rose 0.2% to $3.4795 per lb, having earlier hit its lowest since late September at $3.4555.

Arabica has been trending lower since the Trump administration removed tariffs on coffee imports from top grower Brazil late last month.

Also near-ideal weather in Brazil is boding well for next year's crop.

Robusta coffee LRCc2 fell 0.4% to $3,689 a metric ton, having hit its lowest since mid-August at $3,666.

Local robusta prices in top grower Vietnam's have fallen to their lowest since last March as the harvest is progressing well.

COCOA

New York cocoa CCc1 ​fell 0.4% to $5,957 a ton, reversing some of the gains seen since it hit near two-year lows in November.

London cocoa LCCc1 fell 0.2% to 4,336 pounds per ton.