(Bloomberg) – Cocoa reached the highest level in almost 25 months in New York as a weaker dollar spurred buying of the beans traded in the U.S. currency, while prices fell in London as the pound gained. Sugar retreated.
The dollar reached the lowest level since Feb. 19 against a 10-currency basket after U.S. politicians agreed yesterday to raise the government’s borrowing limit, averting a potential debt default. Cocoa traded in British pounds slid as the currency strengthened after U.K. retail sales climbed more in September than projected by economists surveyed by Bloomberg.
“New York and London cocoa have been going up for the same old reasons,” such as prospects for demand to outpace supply, Jerome Jourquin, head of agricultural derivatives at Aurel BGC in Paris, said by e-mail today. “If New York has been recently firmer than London, it’s a currency matter.”
Cocoa for delivery in December rose 0.5 percent to $2,762 a metric ton by 6:13 a.m. on ICE Futures U.S. in New York. Prices reached $2,771, the highest for a most-active contract since Sept. 19, 2011. Futures trading volumes were 7.7 percent higher than the average for the past 100 days for the time of day, according to data compiled by Bloomberg.
In London, cocoa for delivery in the same month slid 0.2 percent to 1,772 pounds ($2,848) a ton on NYSE Liffe. The contract is up 4.6 percent from the close on Oct. 4, less than the 5.8 percent climb for December cocoa on ICE.
The pound gained as much as 0.9 percent against the dollar, the most in almost a month, data compiled by Bloomberg showed.
Cocoa supplies are set to trail demand by 173,000 tons in the year started Oct. 1, according to Macquarie Group Ltd. Prices climbed 24 percent this year on ICE. Bean processing, an indication of demand, rose 4.7 percent in Europe in the third quarter and 12 percent in Asia, data from the European Cocoa Association and the Cocoa Association of Asia showed.
Raw sugar for delivery in March fell 0.6 percent to 18.89 cents a pound in New York. Refined, or white, sugar for delivery in December slipped 0.1 percent to $506.20 a ton in London.
Arabica coffee for delivery in December was unchanged at $1.1585 a pound on ICE. Robusta coffee for delivery in January lost 0.7 percent to $1,637 a ton on NYSE Liffe.
