SOFTS-Cocoa Falls on Declining Chocolate Demand, Sugar Rises

April 12th, 2017


Category: Cocoa, Sugar

Sugars-Full(Reuters) –  Cocoa futures weakened on Wednesday as a decline in demand for chocolate confectionary hurt sentiment, while firmer technicals helped raw sugar recover further.


July London slipped 21 pounds, or 1.31 percent, to 1,582 pounds a tonne by 1206 GMT, while July New York cocoa fell $27, or 1.36 percent, to $1,961 a tonne.

Both markets made gains on Tuesday in a moderate recovery after prices hit four-week lows recently.

European grind data showed on Wednesday a small increase of 1.1 percent from the same period last year to 339,485 tonnes.

“It’s coming so close to expectations that the figure is not going to be market moving,” said Jonathan Parkman, head of agriculture at Marex Spectron.

However, sentiment was dampened by figures, released in Barry Callebaut’s earnings, showing the chocolate confectionary market shrunk by 2.1 percent in the six months to February.

“That is weaker than I expected and I would suggest it has had a slightly negative effect on people’s perceptions,” Parkman said.

However, Barry Callebaut reported its first-half net profit rose more than expected as outsourcing contracts and gourmet products helped it offset weakness in confectionery.

Worries about ample supplies continued to weigh, with number two grower Ghana outlining plans on Tuesday to introduce hand pollination of cocoa seedlings and begin irrigating farms in a bid to boost output to 1 million tonnes by 2020.


May raw sugar gained 0.11 cent, or 0.66 percent, to 16.83 cents a lb.

The contract closed higher on Tuesday, after falling about 2.5 percent during the session. Dealers said technicals continued to drive Wednesday’s trade, although volumes remained thin.

May white sugar rose $2.1, or 0.43 percent, to $486.30 per tonne.

Open interest on the May contract fell by 5,021 lots to 14,391 lots by Tuesday’s close. The contract expires on Thursday, with dealers anticipating a small delivery.

The premium of the front-month white sugar contract over its raw sugar equivalent rose to its highest since late April 2016, reflecting increasingly attractive refining margins.


May arabica coffee gained 0.20 cent, or 0.14 percent, to $1.4040 per lb.

May robusta slipped $11, or 0.51 percent, to $2,165 a tonne.

Brazil exported 2.36 million 60-kg bags of green coffee in March, well below the 2.77 million bags reported a year earlier despite a larger crop, exporter association Cecafé said on Tuesday.

Add New Comment

Forgot password? or Register

You are commenting as a guest.