cocoa futures brokers

Cocoa premium soars

May 13th, 2013

Cocoa Futures – The premium cocoa for May delivery commands over the July futures tripled on speculation supplies in Europe will be limited before the May contract expires.

Cocoa for May delivery was 42 pounds ($54.53) a ton more expensive than the July futures by 12:58 p.m. in London on NYSE Liffe, up from 13 pounds on May 10 and compared with a discount on May 8. The May contract ends trading on May 15 and the delivery will be the next day.

“The spread should stay firm until the last trading day on speculation of limited supplies in European warehouses,” Jerome Jourquin, head of agricultural commodity derivatives at Aurel BGC in Paris, said by e-mail today.

Prices for near-dated contracts that are higher than later ones is a market situation known as backwardation and may signal limited supplies. The May contract rose 27 pounds and the July contract was down 1 pound.

Cocoa inventories with a valid grading certificate in warehouses monitored by NYSE Liffe were 89,580 metric tons as of April 29, exchange data showed. Beans under other categories totaled 52,570 tons. The delivery for the expired March futures contract was 72,350 tons.

- Isis Almeida in London at Bloomberg.