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May Cocoa Premium Over July Doubles on Shortfall Before Delivery

The premium May cocoa futures command over the July contract more than doubled in London on speculation European inventories will be too small to meet the delivery when the May contract expires this week.

Cocoa for delivery in May was 32 pounds ($49) a metric ton more expensive than July futures on NYSE Liffe, up from 13 pounds on May 10 and compared with a discount on May 8. Backwardation, when prices for near-dated contracts are higher than later ones, may signal scant supply. Trading of May futures ends May 15 and the delivery will be the next day.