SOFTS-Coffee slips from 2-year high as risk appetite diminishes

* Prices weighed by weakness across the commodity complex

* Canaplan forecasts Brazil CS cane crop below 577 mln T

* Cocoa suffers setback but remains above key support

(Adds quotes, updates prices)

LONDON, March 12 (Reuters) - Coffee prices suffered a modest setback on Wednesday after the prior session's rise to two-year highs, with a general reduction in investors' risk appetite prompting some to take profits.

Prices have almost doubled this year as dry weather in top producer Brazil reduced the prospects for the upcoming 2014/15 crop and led to forecasts that there would be a global deficit for the first time in several seasons.

May arabica coffee futures on ICE were off 2.55 cents or 1.2 percent at $2.0310 per lb by 1345 GMT. The contract peaked at $2.0890 on Tuesday, the highest level for the benchmark second position since February 2012.

Investors' risk appetite has been diminished by increased concern about China's economic slowdown and prices for non-agricultural commodities such as copper have fallen sharply.

"The story about China is one that agricultural markets have so far managed to escape but anything which nearly doubles in price in a short period of time, there will be a time for reflection sooner or later," Saxo Bank's head of commodity strategy, Ole Hansen, said.

"With this kind of risk aversion in general we are seeing at the moment there could just be the temptation to book some profits," he added.

Robusta coffee futures on Liffe were marginally higher with May up $3 or 0.1 percent at $2,183 a tonne. The second position peaked at $2,195 on Tuesday, a one-year high.

Dealers said the market was supported by increased demand for robustas in the physical market following the recent sharp increase in its discount to arabicas.


Sugar prices also suffered a setback with May raws on ICE down 0.16 cent, or 0.9 percent, at 17.87 cents a lb.

The market started to climb in late January as dry weather diminished prospects for Brazil's next cane crop. The May contract hit a peak on March 6 of 18.47 cents, a four-month high for the front month.

May white sugar futures on Liffe fell $2.90 or 0.6 percent to $468.10 a tonne.

Brazil's main centre-south sugar cane crop will fall to less than 577 million tonnes in the April-March season, indicative of an expected drop in yields below earlier projections, local analysts Canaplan said on Tuesday.

On Monday, competing analysts Archer Consulting put out their first estimate of the new crop at 590 million tonnes, 1 percent lower than the current crop, which officially ends this month but finished crushing in early January.

"Although analysts continue to downgrade the expected CS Brazil crush, it seems that the speculative buying has become sporadic and producers are getting more willing to take advantage of anything above 18 cents (a lb)," Sucden Financial senior trader Nick Penney said in a market note.

Cocoa futures on ICE joined the retreat with May down $69 or 2.3 percent at $2,937 a tonne after climbing to a peak of $3,027 on Tuesday, a 2-1/2-year high.

Hansen said speculators would remain comfortable with the current large net long position as long as prices held above key support around $2,900.

"That will be a level where there will be quite a few handbrakes pulled, but until we see that level those who have been enjoying the ride will not be considering changing too much," he said.

May cocoa on Liffe stood 28 pounds lower at 1,850 pounds a tonne.

(Editing by Dale Hudson and David Evans)