Cocoa Heads for Longest Slide in Six Weeks; Sugar Rises
Cocoa futures fell, capping the longest decline in six weeks, on speculation that favorable weather will boost crops in West Africa, the world’s top producing region. Sugar rose, while coffee was unchanged.
West Africa has had widespread rains in the past week, with similar conditions expected this week, Kyle Tapley, a meteorologist with Gaithersburg, Maryland-based MDA Information Systems Inc. said today in an e-mail. While causing some “minor slowdowns” in gathering the mid-crop -- the smaller of the region’s two annual harvests that usually starts in April -- the precipitation will favor development of the region’s bigger, main crop, he said.
“The recent run of good weather across West Africa,” has been putting pressure on prices, Drew Geraghty, a commodity broker with ICAP Futures LLC in Jersey City, New Jersey, said today in an e-mailed report.
Cocoa for July delivery slid 0.9 percent to settle at $2,105 a metric ton at 12:03 p.m. on ICE Futures U.S. in New York, after reaching $2,094, the lowest for a most-active contract since April 12. Today marks the fourth straight decline and the longest slump since April 4.
Raw-sugar futures for July delivery increased 0.4 percent to 19.58 cents a pound on ICE. The sweetener is still down 7.3 percent in May.
While “prices are likely to fall somewhat further in the short term in view of current market sentiment, we expect them to return soon to above the 20-cent mark,” Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt, wrote in a report e- mailed today.
Arabica-coffee futures for July delivery closed unchanged at $1.669 a pound on ICE, after slumping 4.4 percent yesterday.
In London futures trading, cocoa slid on NYSE Liffe. Refined sugar and robusta coffee gained.
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