Cocoa Slips on Ivory Coast Oversupply Worries

February 24th, 2017


Category: Cocoa

cocoa beans 450x299(The Times of India) –  Cocoa futures eased back on Friday, as enduring worries about strong production in top grower Ivory Coast outweighed signals that the country has mostly eased an immediate supply glut in the market.


May London cocoa was down 13 pounds, or 0.8 percent, at 1,617 pounds a tonne by 1306 GMT, while May New York cocoa fell $8, or 0.39 percent, to $2,018 a tonne.

The market found reprieve in the previous session, gaining on short covering after the Ivory Coast signaled it may have resold most of the cocoa behind a supply glut.

However, the lift was short lived, with dealers noting the large number of spot sales was not entirely surprising since the main crop is close to wrapping up.

“I think the more pressing matter is what they do with the mid-crop,” said one dealer. “The mid-crop is looking good. And they’ve obviously got a decision to make on farmer pricing for the mid-crop coming up. There are a few issues to sort out.”

The London market was further weighed by a firmer pound, which was on course for its strongest week in a month.


May raw sugar futures were marginally higher, climbing 0.01 cent, or 0.05 percent, to 20.14 cents per lb.

The Feb. 28 expiry of the front month contract was in focus, with INTL FCStone noting deliveries from Mexico, Guatemala and El Salvador were expected, as well as smaller volumes from northern Brazil.

“The contract expires on Tuesday and we expect a sudden downward shift in market sentiment could widen the spectrum of deliverers at the tape, and the volume at which they deliver,” said Darren Stetzel, sugar analyst.

May white sugar was up $0.30, or 0.05 percent, at $548.90 a tonne.


May arabica fell 0.25 cent, or 0.17 percent, to$1.497 per lb.

Dealers said prices were pressured by technicals, with the May contract struggling to hold above a key resistance level at$1.50.

Robusta coffee eased further as well, with the May contract down $6, or 0.28 percent, at $2,149 a tonne.


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