Cocoa Surges to 23-Month High on Supply Concerns; Cotton Tumbles

Cocoa futures rallied to a 23-month high on concern that excessive rainfall may disrupt supplies from West Africa, the world’s largest growing region. Sugar and coffee rose, while cotton and orange juice fell.

Cocoa areas in Ivory Coast and and Ghana, the top producers, may get as much as 150 percent of normal rain in the second half of October, slowing the harvest, Drew Lerner, the president of World Weather Inc. in Overland Park, Kansas, said Oct. 4. Stockpiles held at warehouses monitored by ICE Futures U.S. exchange fell for a 28th straight session to the lowest since February.

“Any disruption in the flow of cocoa from point A to point B is bullish for prices over the near term,” Michael K. Smith, the president of T&K Futures & Options inc. in Port St. Lucie, Florida, wrote in an e-mail. “The falling stockpiles at the ICE are helping compound the bullish effect of the weather-related harvest slowdown for cocoa.”

Cocoa futures for December delivery jumped 3.4 percent to settle at $2,699 a metric ton at 12:01 p.m. on ICE in New York, after touching $2,710, the highest for a most-active contract since Nov. 8, 2011.

Raw-sugar futures for March delivery gained 0.6 percent to 18.59 cents a pound in New York. Arabica-coffee futures for December delivery added 0.1 percent to $1.145 a pound.

Cotton futures for December delivery tumbled 3.6 percent to 84.02 cents a pound on ICE, the biggest drop since Aug. 21.

Southeast growing areas of the U.S., the biggest cotton exporter, got less rain than forecast from Tropical Storm Karen, which fell apart over the weekend, according to MDA Weather Services in Gaithersburg, Maryland.

“The storm being weaker than expected is negative since possible damage will be reduced,” Sid Love, the president of Joe Kropf & Sid Love Consulting Services in Overland Park, Kansas, wrote in an e-mail.

Orange-juice futures for November delivery slid 0.3 percent to $1.278 a pound.

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