May 17 (Bloomberg) -- Cocoa futures fell, heading for the biggest weekly drop in a month, as the debt crisis in Europe and slower growth in the U.S. may curb demand for chocolate from the world’s biggest consumers. Sugar and coffee gained.
U.S. and European equities slid on speculation that Spanish banks may have their credit ratings lowered by Moody’s Investors Service. Manufacturing in the Philadelphia region unexpectedly shrank in May for the first time in eight months. In North America and Europe, the world’s biggest cocoa-consuming regions, bean processing this year will be “at best” unchanged, and “at worst” it will be down a couple of percentage points from 2011, according to Blommer Chocolate Co.
“Consumption may go down because of the European situation,” Andrey Kuznetsov, the president of Wild Bear Capital, a broker based in Moscow, said in an e-mail.
Cocoa for July delivery slid 3 percent to settle at $2,224 a metric ton at 12:08 p.m. on ICE Futures U.S. in New York. Prices are down 4.1 percent this week, heading for the biggest drop since April 6.
The Standard & Poor’s GSCI Spot Index of 24 raw materials dropped as much as 0.8 percent, heading for the 11th decline in 12 sessions.
“Most investors are taking a hands-off approach as we continue the decline in the global equities markets,” Hector Galvan, a senior broker at RJO Futures in Chicago, said in an e-mail.
Raw-sugar futures for July delivery advanced 0.6 percent to 20.86 cents on ICE, the fourth straight gain.
The sugar-cane crop in Brazil’s center south, the world’s top-producing region, will be 500 million tons in the season that started April 1, Luis Roberto Pogetti, the chairman of Copersucar, said in an interview in New York yesterday. That compares with a March forecast for a crop between 500 million and 520 million tons.
Arabica-coffee futures for July delivery climbed 1.2 percent to $1.801 a pound.
Rains have delayed coffee harvesting in some key growing areas of Brazil, the world’s largest producer, Cooxupe, the country’s top exporter, said.
In London futures trading, cocoa and robusta coffee also dropped on NYSE Liffe. Refined sugar gained.
To contact the reporter on this story: Marvin G. Perez in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Steve Stroth at email@example.com