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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.
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cocoa futures rebound
April 23rd, 2013
Cocoa futures rebounded in London on speculation producing nations in West Africa, the main growing region, have sold a lot of their crops, removing some hedging pressure from futures markets. Coffee and sugar slid.
Producing countries may have sold up to 250,000 metric tons of cocoa in the past 10 to 15 days, according to London-based futures and options brokerage Marex Spectron Group. Prices fell as much as 1.3 percent in London yesterday as money managers boosted bets on higher prices to this year’s high in the week ended April 16, leaving the market vulnerable to liquidation.
“Cocoa collapsed yesterday because speculators bought more -mostly covering shorts- than initially thought,” Eric Sivry, head of agriculture options brokerage at Marex Spectron, said by e-mail today. “With origins having sold a lot recently, selling pressure has been slightly removed.”
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cocoa futures move higher
April 19th, 2013
Cocoa futures, already headed for their biggest monthly gain since August, probably will advance further to the highest since early December, according to a technical analysis by John Caruso at RJO Futures.
Cocoa prices on ICE Futures U.S. in New York are sending bullish signals after surging above the 50-day moving average of $2,149 a metric ton on April 8 and then the 100-day average of $2,246 three days later, Caruso said. Today, after advancing to $2,348, the highest for a most-active contract since Dec. 21, cocoa is above the 200-day moving average of $2,331.
“We need to close above the $2,331 level,” Caruso, a senior broker with Chicago-based RJO, said in a telephone interview. “If we do that, this market could press on toward the $2,450 and $2,550 area before September. If the price fails to close above $2,331, we will probably see a consolidation phase between $2,260 and $2,330 before another push to the upside.”
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April 5th, 2013
Cocoa futures fell for a third day in London on speculation rain is helping boost crop prospects in Ivory Coast, the world’s largest grower. Sugar also declined.
The Daloa region, which accounts for about a third of Ivory Coast production, had three times more rain from March 21-31 than a year earlier, according to the National Meteorological Service. The Standard & Poor’s GSCI gauge of 24 commodities is down 3.3 percent this week, heading for the biggest weekly decline since October.
“There was some concern dry weather would have a negative effect in Ivory Coast so the rain may be easing those concerns,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt, by phone today. “Cocoa is getting caught up with selling of many commodities.”
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March 28th, 2013
Cocoa futures climbed for a third day in London and New York, and the gains may be capped as Ghana still has to sell more beans. Robusta coffee fell for a fifth day.
Cocoa has climbed the past three days on buying by speculators because the market is “still considered tight,” Kona Haque, an analyst at Macquarie Group Ltd. in London. Cocoa demand may be equal to or slightly above production this season, she said.
“Every time the market tries to rally we get into Ghana selling,” Haque said by phone today. “Speculators are pushing the market higher.”
Cocoa futures for May delivery climbed 0.6 percent in New York to $2,162 a metric ton by 7:41 a.m. on ICE Futures U.S. Prices are down 3.3 percent in New York this year and up 1.7 percent in London. Beans trade in pounds in London and dollars in New York.
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March 21st, 2013
Cotton Futures – The longest cotton rally in four years and a lingering drought in the southern Great Plains are forcing farmers in the U.S., the world’s biggest exporter, to reconsider a shift to other crops.
Planting may total 11 million acres, 10 percent more than a Feb. 22 government forecast of 10 million, said Jordan Lea, the chairman of Eastern Trading Co., an exporter in Greenville, South Carolina. Prices are up 37 percent from a 31-month low in June and heading for a fifth monthly gain, the longest since July 2009. Corn fell 3.4 percent since the end of October.
The price surge was the “number one” reason “for me switching back to cotton,” said Randy McGee, 35, who farms 1,200 acres in Idalou, Texas. He’s ditching plans to sow corn and sorghum on 300 acres of non-irrigated land that he now plans to use for cotton. “December grain and corn prices aren’t looking too promising. I’m sending my seed back.”
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coffee futures gain
March 20th, 2013
Coffee Futures – Coffee roasters are poised to add more arabica beans to their blends at the expense of robusta as the two varieties’ relative cost narrows to a four-year low.
The gap between futures declined to 35.4 cents yesterday from $1.89 in May 2011. The switch takes several months and probably will start if the spread stays at 35 cents, said Rodrigo Costa, director of trading at Caturra Coffee Corp. in Elmsford, New York. Arabica will average $1.57 in the fourth quarter, 18 percent more than now, as robusta drops 3.6 percent to $2,075 a metric ton (94 cents a pound), the medians of as many as six analyst estimates compiled by Bloomberg show.
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March 14th, 2013
Cotton futures rose to a 10-month high in New York on stronger U.S. exports stoked by Chinese demand and on speculation planting may decline as the fiber competes with corn and soybeans for acreage.
U.S. exports of upland cotton since the start of August reached 6.77 million bales as of March 7, up from 5.59 million bales a year earlier, the U.S. Department of Agriculture reported today. Weekly net sales of upland cotton were 187,561 bales, up from 150,083 bales in the week through Feb. 28, USDA data show.
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March 12th, 2013
Cocoa futures climbed to a three- week high on signs of reduced deliveries by farmers in Ivory Coast, the world’s biggest producer. Orange juice and cotton also gained, while coffee slid. Sugar was unchanged.
Purchases of cocoa beans by the Ivory Coast government fell 7.5 percent in the first three months of the season that began in October, according to a document sent to Bloomberg by an official in the ministries of finance and agriculture. Deliveries to ports from farms slid to 649,249 metric tons, compared with 702,127 tons a year earlier, the data show.
“This should allow prices to work higher as there will be less cocoa on the market,” Sterling Smith, a futures specialist at Citigroup Global Markets Inc. in Chicago, said in an e-mail. Supplies in the Ivory Coast are getting tighter, and some beans have poor quality, Smith said.
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January 29th, 2013
Cotton futures traded in China’s Zhengzhou climbed the most in a year after government purchases reduced the supply in the local market.
Cotton for May delivery advanced 2.6 percent to 20,385 yuan ($3,273) a metric ton on the Zhengzhou Futures Exchange, the biggest gain at close since Feb. 1, 2012. The most-active contract is headed for a 7.6 percent gain this month, the most in two years.
The Chinese government bought record quantities of cotton in the last two years to protect domestic farmers, according to the China Cotton Association. The country stockpiled 5.83 million tons from the current harvest, about 85 percent of the total output, as of Jan. 22, the group said. Purchases in 2011 were 3.12 million tons, the government said.
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