SOFTS-Liffe cocoa rises, arabica coffee recovers on crop concerns
* Dry weather in West Africa fuels buying in cocoa market
* Arabica coffee rallies on crops concerns in Brazil
* Producer selling helps stall advance in sugar prices
(New throughout, updates prices; adds byline, NEW YORK dateline)
NEW YORK/LONDON, Aug 14 (Reuters) - ICE cocoa futures posted their biggest gains in a week on Wednesday on concerns over dry weather in top grower Ivory Coast, and ICE arabica coffee rallied on short-covering and expected crop losses due to frost in Brazil, the world's top producer.
ICE raw sugar was little changed, consolidating after prices touched a seven-week high during the previous session.
The December cocoa contract on ICE Futures U.S. finished up $37, or 1.5 percent, at $2,495 a tonne.
December cocoa in London closed up 17 pounds, or 1 percent, at 1,655 pounds a tonne. The contract peaked at 1,671 pounds last week, the highest level for the second month since September 2012.
Prices have jumped about 8 percent on ICE and nearly 6 percent on Liffe this month. Worries over dry weather in Ivory Coast have driven buying in recent sessions.
"We won't know until the harvest what the impact is, but the weather is providing underlying support. Pullbacks are finding technical support," said Boyd Cruel, softs analyst for Vision Financial Markets in Chicago.
Dealers said large speculative net long positions in cocoa left the market susceptible to a substantial fall if the dry weather concerns prove to be overstated.
Reports on positions in both Liffe and ICE cocoa in the last few days have shown speculators increasing already large net long positions.
Dealers said origin selling from both Ivory Coast and Ghana was helping to keep a lid on prices.
"Ivory Coast and Ghana have been selling, and I think they will continue. It is a very good price for them," one London dealer said.
COFFEE RECOUPS LOSSES
Arabica coffee futures on ICE rose sharply, clawing back the bulk of the prior session's steep losses.
December arabica coffee futures rose 3.55 cents, or 2.9 percent, to $1.2655 per lb by 12:25 p.m. EDT (1625 GMT). The contract fell more than 3 cents on Tuesday.
Brazil's Parana state said on Wednesday that 62 percent of next year's coffee crop in the state would be lost due to frost in late July. That would mean a loss of about one million 60-kg bags.
That represents only a small part of Brazil's total output, but it helped drive short-covering, dealers said.
"Coffee took a pretty good beating (yesterday) and the Parana production loss is providing support here," said Sterling Smith, a futures specialist with Citigroup in Chicago.
Dealers continued to eye cold weather in Brazil, where huge output has pressured prices to recent four-year lows.
Robusta coffee futures on Liffe were also higher, with November up $17, or 0.9 percent, at $1,925 a tonne.
"There's a little bit of industry buying around. Roasters are buying second quarter next year," one dealer said.
Raw sugar futures on ICE were little changed as the market's recent run-up was seen losing momentum.
Dealers continued to keep a close watch on the weather in top producer Brazil, with Parana facing the potential for frost later this week before temperatures begin to climb. No significant damage is expected, however, at this stage.
October raw sugar on ICE edged up 0.02 cent, or 0.1 percent, at 17.27 cents a lb, consolidating after recent gains and capped by producer selling.
The contract climbed to a peak of 17.29 cents on Tuesday, the highest level for the front month since June 25 and up more than 8 percent from a three-year low of 15.93 cents in mid-July.
"I think some of the producers are selling at this price level," said Jonathan Kingsman, head of agriculture at data provider Platts.
October white sugar on Liffe LSUc1 was up $1.70, or 0.3 percent, at $504.90 a tonne.
(Additional reporting by Silvia Antonioli and Sarah McFarlane; Editing by Jason Neely, Jane Baird and John Wallace)