SOFTS-ICE sugar slips as rebound stalls, coffee turns lower

* Record sugar output for Brazil 2013 crop expected

* Brazil farmers withhold coffee, hoping for higher prices

* Cocoa remains stuck in tight range

(New throughout, updates prices; adds trade comment, second byline/dateline)

NEW YORK/LONDON, Dec 18 (Reuters) - Raw sugar on ICE slipped Tuesday on surplus supplies following two sessions of gains that lifted the market from the lowest level in more than two years.

Arabica coffee was weak but choppy, while cocoa futures slipped but remained stuck in a tight range. Dealings were light ahead of the Christmas holiday next week.

March raw sugar futures on ICE eased 0.28 cent, or 1.4 percent, to 19.13 cents a lb by 12:07 p.m. EDT (1707 GMT). The contract rose on Monday after dipping last week to 18.31 cents, the lowest level for the benchmark front month since August 2010.

"I don't see any reason why the market should continue its recovery," said Stefan Uhlenbrock, an analyst at F.O. Licht. "There's lots of sugar around and more to come, and there's no factor in play in my view that could support a sustainable rise in prices."

Societe Generale said the market faced resistance at 19.45-19.55 cents per lb, with the next resistance level seen at 19.95-20.10 cents per lb.

The spot contract left a technical gap between 19.06 cents and 19.14 cents in the two previous sessions, creating pressure, dealers said.

"Sugar had a good run the last couple days and had to fill that gap left from Friday to Monday," one U.S. dealer said.

March white sugar on Liffe fell $5.20, or 1 percent, to $515.60 per tonne.

Dealers said top producer Brazil's current center-south crop may exceed 34 million tonnes after favorable weather aided the tail of the harvest. They said prospects for the next crop were also positive.

"The market is already talking about another record figure of nearly 37 million tons of sugar from Center-South. In this situation, the sugar price is unlikely to make any great leaps upward," Commerzbank said in a daily commodities note.

COFFEE

March arabica coffee futures on ICE inched down 0.60 cent, or 0.4 percent, at $1.4535 per lb. The contract remained above last week's two-and-a-half-year low of $1.4220 but continued its downtrend.

Dealers and analysts noted that the market was well supplied following Brazil's large on-year crop in its biennial cycle and increased production from some Central American countries.

"I'm not seeing the end of this bear market around the corner because supply is ample. There's lots of coffee around, especially with this big Brazilian crop. A lot of it is still being withheld by local farmers because they are not satisfied with current prices," F.O. Licht's Uhlenbrock said.

"I'm afraid that they will have to sell at these prices or even at lower prices in the coming month, and this supply pressure will add to the already well supplied market."

March robusta coffee futures were up $11, or 0.6 percent, at $1,852 a tonne.

Dealers monitored the narrowing of January's premium to March <LRC-1=R>, which traded at around $22 after widening to more than $50 in recent sessions.

Domestic coffee prices in Vietnam, the world's largest robusta producer, fell to the lowest level in more than 10 months on ample supplies, with the harvest expected to end this month, a little earlier than usual, traders said on Tuesday.

May cocoa on Liffe closed down 21 pounds, or 1.4 percent, at 1,511 pounds a tonne.

Dealers noted that both the London and New York markets continued to trade inside a tight range and were technically trendless, based on historical price charts. Arbitrage dealings weighed on the market as the firm pound was seen pressuring the London market, dealers said.

"We've got a 12-month range, a narrower almost three-month range, and a very narrow two-week range," a UK-based broker said. "The bulls and the bears have gradually narrowed the range, and something has got to give at some point."

March cocoa futures on ICE settled down $28, or 1.2 percent, at $2,397 a tonne.

(Editing by Jane Baird, Keiron Henderson and John Wallace)