Sugar Falls After Oil Price Slumps as Trump Backs Down on Iran Power Strikes

LONDON, March 23 (Reuters) - Raw sugar futures on ICE fell on Monday after oil prices slumped following comments from U.S. President Donald Trump that he would postpone any strikes on Iranian power plants and energy infrastructure.

Falling energy prices can prompt cane mills in top growers Brazil and India to produce more sugar and less ethanol, a cane-based biofuel.

SUGAR

Raw sugar SBc1 ​fell 1% to 15.55 cents per lb at 1253 GMT, having earlier hit its highest since October at 15.75.

The contract posted a gain of nearly 10% last week, matching gains in the energy complex and marking its highest weekly ascent in 1-1/2 years thanks to soaring energy prices linked to the Iran war.

Trump's move earlier to postpone any strikes against Iranian power plants by five days gave sugar a breather, however, coming just hours ahead of a deadline that threatened further escalation in the four-week-old conflict.

Also weighing on the sweetener, mills in No. 2 grower India have returned to the export market, locking in 100,000 metric tons of shipments in a week after a slump in the rupee and a rally in global prices restored the economics of overseas sales.

White sugar LSUc1 fell 0.4% to $449.40 per metric ton, having gained 8.7% last week.

COFFEE

Arabica coffee KCc1 fell 1.4% to $3.0540 per lb, having gained 8.6% last week.

A record crop is expected later this year in top grower Brazil, but for now farmers are holding back sales as freight, fertilizer and energy costs remain lofty due to the Iran war and further shipping disruptions are likely.

"Brazil said last week that exports dropped significantly in February and might not improve that much in March," noted Price Futures Group.

Robusta coffee LRCc2 fell 0.9% to $3,632 a ton. It gained 6% last week.

COCOA

London cocoa LCCc1 gained 1.1% to 2,440 pounds a ton.

Cocoa arrivals at ports in top grower Ivory Coast were down 2.5% from the season start to March 22 versus the same period a year ago. They are picking up on a weekly basis, however.

New York cocoa CCc1 rose 1.4% to $3,303 a ton.