SOFTS-Cocoa edges lower after weak grind data

* Europe 4th-quarter cocoa grind down 6.2 pct

* Sugar dealers wary of potential short covering rally

(Adds details, updates prices)

LONDON, Jan 15 (Reuters) - Cocoa futures eased on Tuesday following the publication of weak fourth-quarter European grindings, which were in line with expectations.

Sugar edged lower, while arabica coffee hovered below the previous session's nine-week high.

ICE cocoa was slightly lower after European Cocoa Association data on fourth-quarter cocoa grindings showed a fall of 6.2 percent.

"It's come in smack on where we thought the headline number would be," Jonathan Parkman, joint head of agriculture at Marex Spectron, said.

Meanwhile, cocoa grindings in Malaysia rose 3.6 in the fourth quarter of 2012 compared with the same period last year, while Brazil's cocoa industry processed a record quantity of beans in 2012.

Dealers awaited the publication on Thursday of North American grindings data.

"As people begin to digest the numbers and add things together, rather than just a gut reaction on the ECA grind, they'll probably come to the conclusion that grinds haven't been too bad," Parkman said.

"It looks as if the grinds were only about 2 percent down across the reporting areas."

ICE March cocoa futures traded down $16 or 0.7 percent at $2,251 per tonne at 1506 GMT.

Parkman warned of pitfalls in using grindings as an indicator of consumption.

"We like to use grindings as a proxy for consumption, but as was shown in 2011/12, that was a hazardous thing to do. Grinds ran well ahead of consumption in the period of October-March and well behind consumption in the period of April-September," he said.

Benchmark London May cocoa futures traded down 3 pounds or 0.2 percent at 1,451 pounds ($2,300) per tonne.

SUGAR

March raw sugar futures on ICE slipped by 0.12 cent or 0.6 percent to 18.78 cents a lb.

Dealers said a large speculative short position on ICE raw sugar made the market vulnerable to a short-covering rally.

"We're fundamentally bearish, but we're loath to get too bearish when you've already got all these funds short," a European analyst said.

Speculators bolstered their net short position in raw sugar contracts by 10,691 contracts to 37,936 contracts, U.S. Commodity Futures Trading Commission data showed on Friday.

If the market breaks above 19.67 cents, it will confirm a bullish technical signal, Societe Generale said in a commodities note.

March white sugar on Liffe edged down $3.00 or 0.6 percent to $504.70 per tonne.

"When the market dips, you get little bits of physical offtake but it's relatively quiet," the analyst said.

ICE second-month arabica coffee futures threatened to break above their nine-week high of $1.5855 per lb, hit the previous session.

"The market needs to break out of its $1.40-$1.60 per lb range," a London-based broker said.

ICE March arabica coffee was up 2.45 cents or 1.6 percent to $1.5575 per lb.

March robusta coffee futures rose $6 or 0.3 percent to $1,977 a tonne.

"There's boatloads of (robusta) coffee, but it's all going straight into the roasters. They've got a decent appetite for robustas," the broker said. ($1 = 0.6224 British pounds)

(Reporting by Sarah McFarlane; Editing by Anthony Barker and Jane Baird)