Cocoa fell from the highest in almost one year in New York as rain in West Africa, the biggest growing region, may help relieve crops after dry weather. Sugar climbed for a seventh day, the longest streak in almost a year.
About 1 to 1.25 inches of rain fell in parts of Ivory Coast the past few days and about half an inch in Ghana, Kyle Tapley, senior agriculture meteorologist at MDA Weather Services in Gaithersburg, Maryland, said today. Cocoa jumped 13 percent the past two months on speculation dry weather would damage crops for the harvest that starts next month, leading hedge funds and other speculators to bet on more price gains.
“Some of the recent long position is certainly based on the dry weather concerns in West Africa, and therefore may lose its nerve should rains continue as normal,” Marex Spectron Group Ltd. in London said in a report yesterday. “For this to translate into a more serious liquidation of the spec position involving the system funds, some members of the industry will have to develop nerves of steel.”
Cocoa for December delivery dropped 0.4 percent to $2,581 a metric ton by 8:14 a.m. in New York on ICE Futures U.S. Prices earlier today climbed to $2,609, the most since Sept. 17.
Raw sugar for March delivery climbed 0.1 percent to 17.74 cents a pound on ICE. Prices rose 8.3 percent in the past seven sessions, the longest streak for a most-active contract since Sept. 17. Kingsman SA lowered its forecast for a surplus in the 2013-14 season by 4.6 percent, saying demand is improving.
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