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Cocoa Drops to 5-Week Low on Rising Supply; Sugar, Cotton Fall

Dec. 19 (Bloomberg) -- Cocoa dropped to a five-week low in New York on signs of rising supplies from Ivory Coast, the world’s largest producer. Sugar and cotton also slid, while coffee and orange juice advanced.

In November, cocoa exports from Ivory Coast’s port of San Pedro climbed 40 percent from a year earlier to 60,931 metric tons, data from the harbor showed on Dec. 17. Shipments jumped 84 percent to 34,670 tons in October.

Increasing supplies “have continued to pressure the markets lower,” Hector Galvan, a senior broker at RJO Futures in Chicago, said in an e-mail.

Cocoa for March delivery retreated 1.6 percent to settle at $2,358 a ton at 12:08 p.m. on ICE Futures U.S., after touching $2,345, the lowest for a most-active contract since Nov. 12. Prices have risen 12 percent this year.

In the week ended Dec. 11, money managers lowered their net wagers on a rally by 3 percent to 39,640 futures and options from 40,871 a week earlier, the highest since January 2010, U.S. government data show.

“There are massive speculative net-long positions in cocoa, and some liquidation is occurring before year-end,” Shawn Hackett, the president of Hackett Financial Advisors, Inc. in Boynton Beach, Florida, said in an e-mail.

Raw-sugar futures for March delivery declined 0.8 percent to 19.23 cents a pound on ICE. The sweetener has slumped 17 percent this year.

Also in New York, cotton futures for March delivery fell 0.1 percent to 75.89 cents a pound, extending this year’s slide to 17 percent.

Arabica-coffee futures for March delivery gained 0.6 percent to $1.449 a pound on ICE, while orange-juice futures for March delivery rose 1.4 percent to $1.42 a pound.

To contact the reporter on this story: Marvin G. Perez in New York at mperez71@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

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