Friday, 13 November 2015 01:03
NEW YORK/LONDON: London cocoa futures on ICE rose to a 2011 high on Thursday, on concerns that the flow of beans in West Africa may be starting to slow down and on technical buy-signals following a month-long rally.
Raw sugar futures continued their volatile dealings and rose nearly 2 percent, while arabica coffee prices fell to a seven-week low.
In cocoa, dealers said the market was keeping a close watch on the flow of cocoa out of top grower Ivory Coast, with some expecting port arrivals to begin to tail off soon, as well as purchases in No. 2 producer Ghana.
“Some people are saying the arrivals are slowing a little bit in Ivory Coast and some people are saying the purchases in Ghana might be slowing down,” one U.S. trader said.
Some speculators, who recently took on new short positions, were forced to take cover, helping to feed the upward momentum as the market extended gains above long-term moving averages.
“The jury is out on Ivory Coast, although most are expecting a lower crop,” one analyst said.
“Arrivals this week should be closer to 50,000 tonnes than 60,000 tonnes, which is a step in the right direction for the bulls.”
London March cocoa settled up 15 pounds, or 0.7 percent, at 2,257 pounds per tonne, down just a tick from the session high at 2,258 pounds, the highest since March 2011 for the benchmark second month.
Prices have risen by about 9 percent since mid-October.
New York March cocoa settled up $ 15, or 0.5 percent, at $ 3,328 per tonne.
March raw sugar settled up 0.28 cent, or 1.9 percent, at 14.97 cents per lb.
“We feel the reaction earlier this week is constructive and shows there is buying appetite on dips by the speculative community,” Sucden Financial senior trader Nick Penney said.
White sugar futures were also higher, with March settled up $ 4.60, or 1.2 percent, at $ 402.60 per tonne.
Dealers said a small delivery is expected on the December whites contract that expires on Friday, with the December/March spread hovering just above the prior session’s contract low of a $ 15.90 discount.
Arabica coffee futures were lower, with March settling down 1.4 cent, or 1.2 percent, at $ 1.1875 per lb.
Dealers said a strong flow of coffee from Brazil was helping to keep a lid on the market.
January robusta coffee settled down $ 23, or 1.41 percent, at $ 1,609 per tonne.
