Cocoa futures rise from multi-year lows

On December 20, 2016, in cocoa futures trading news report, by Infinity Trading
cocoa futures news

cocoa futures news

December 20th, 2016

Cocoa futures prices were boosted on Monday by news that speculators had increased further an already large short position, prompting some to expect there may be scope for a short-term rebound in prices. May New York cocoa was up $51, or 0.85 percent, at $2,257 a tonne at 1500 GMT. The second position has recovered some ground after dipping to a low of $2,144 a week ago, its weakest since July 2013.

Speculators boosted bearish bets on cocoa to a 4-1/2 year high in the week to Dec. 13, US Commodity Futures Trading Commission data showed on Friday. Dealers said the scope for further losses may also be limited after a prolonged slide, with the market on course to fall nearly 30 percent in 2016.

The decline has been driven by forecasts of a global surplus in 2016/17 and the strong current pace of port arrivals in top producer Ivory Coast. Good weather with a mild Harmattan wind and scattered rainfall should lead to an ample main crop in Ivory Coast, farmers said on Monday. The dry dusty wind from the Sahara was particularly strong last year, damaging bean quality.

“It feels as though a lot of the move has happened. The story of (global) surplus, of good arrivals, is the reason we are where we are,” one dealer said. May London cocoa was up 37 pounds, or 2 percent, at 1,861 pounds a tonne. Raw sugar futures were nearly flat, consolidating ahead of the holiday season, despite a decidedly bearish outlook.

- Business Recorder.