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SOFTS-Arabica coffee steady, producer selling caps upside

* Arabica market under pressure from Brazil producer selling

* Brazil dry weather could see sugar output revised higher

(Adds details, quotes, updates prices)

LONDON, Oct 31 (Reuters) - Arabica coffee futures were steady on Wednesday as selling from top producer Brazil weighed and dealers monitored weather conditions in the U.S. after exchange stocks on the east coast were unscathed by stormy weather.

The risk premium which built up in arabica futures in the lead up to the storm was erased on Tuesday, as U.S. warehouses reported no damage.

Raw sugar futures edged lower, with dry weather in Brazil expected to aid harvest progress in the second half of October, while cocoa was near unchanged.

December arabica coffee futures were up 0.15 cent or 0.1 percent at $1.5735 per lb at 1322 GMT. The second-month hit $1.6070 on Monday, the lowest level since Sept. 7.

``The outlook for arabicas is very bearish,'' said a London-based broker.

``There's still the remainder of Brazil's crop to sell, that's going to weigh on the market. I think arabica could come down to $1.40.''

January robusta coffee futures were down $1 or 0.1 percent at $1,982 a tonne, after touching $1,966 earlier in the session, the lowest level for the second-month since July 15, as top producer Vietnam's large crop weighed.

``Most people have a flat supply and demand picture for robusta,'' said the broker.

SUGAR SLIPS

March sugar futures eased 0.09 cents or 0.5 percent to 19.47 cents a lb, remaining near Monday's five-week low of 19.27 cents, as the tail-end of Brazil's harvest was expected to benefit from dry weather.

``Physical values continue weak and weather in centre south Brazil drier than expected, leading some to believe that output will be greater than expected in the latter stages of the crush,'' said Nick Penney of brokerage Sucden Financial.

``Short term, we are aware the market may be a touch oversold and could retrace sharply as a result of short covering by speculators who have recently gone short and may be getting bored with waiting for new lows to be tested.''

New York March sugar seems to rebound more to 19.86 cents per lb, as it stood above support at 19.48 cents after piercing briefly below this level, according to Reuters analyst Wang Tao.

December white sugar on Liffe was down $2.70 or 0.5 percent at $542.00 per tonne.

ICE December cocoa was up $11 at $2,401 per tonne, steadying after a volatile previous session, with dealers noting potential for speculator activity to be driven by month-end book squaring.

``I think a lot of speculators got dragged into the El Nino story and the Ivory Coast reform story and they're protecting a position and waiting for a catalyst to send the market higher,'' said a London-based broker.

``Demand is at best ok, crops are ok, there's no reason for speculators to be long.''

In the latest exchange data speculators increased net long positions in both London and New York.

Benchmark Liffe March cocoa futures were up 5 pounds at 1,546 pounds per tonne.

``I don't think there's a strong story so the market will go sideways, the range is 1,450 - 1,650 pounds. Below 1,500 you'll get good industry offtake,'' added the broker.

(Reporting by Sarah McFarlane, editing by William Hardy)