* Brazil in no rush to sell coffee as prices surge
* Ivory Coast cocoa exports dry up as crisis deepens
* Sugar boosted by prospect of European Union imports
(Adds quotes, bylines, background)
By Sarah McFarlane and Nigel Hunt
LONDON, Feb 22 (Reuters) - Cocoa and arabica coffee futures
rose to the highest levels in more than three decades on ICE on
Tuesday, with cocoa driven by turmoil in top grower Ivory Coast
and coffee by tight supplies of high quality beans.
Cocoa futures have been rising as the crisis in Ivory Coast
has shut down international banks and has led to a virtual halt
in exports.
Ivorian troops killed at least six protesters who were
calling on Laurent Gbagbo to step down as leader on Monday,
witnesses said, as African presidents charged with resolving the
crisis met the incumbent in Abidjan. [ID:nLDE71K1E6]
"The situation is not getting any better," said Kona Haque,
commodity strategist at Macquarie Bank. "I think the risks are
rising for short-term supply disruptions."
May cocoa futures on ICE CCc2 stood $38 or 1.1 percent
higher at $3,537 a tonne after rising earlier to a 32-year peak
for the second month of $3,574.
Prices on Liffe also advanced with May LCCc2 up 28 pounds
or 1.2 percent at 2,314 pounds a tonne.
In a bid to starve Gbagbo's government of funding from the
cocoa trade, rival Alassane Ouattara has called on exporters to
suspend business during the month of February and has left open
the option of a longer embargo, which dealers fear could cause
major problems for global cocoa supplies.
"There's a big risk of the ban being extended into the
mid-crop," Haque said.
COFFEE, SUGAR
Coffee prices have doubled since June 2010 with supplies
tightened by three consecutive below-par harvests in Colombia,
the world's top producer of high quality washed arabica beans.
"Physical (coffee) prices are still very strong, and Brazil
are in no rush to sell," Haque said. "A good chunk of the
farmers are pretty much sold out anyway."
May arabica futures KCc2 stood 2.00 cents or 0.7 percent
higher at $2.75 per lb at 1200 GMT. The contract earlier peaked
at $2.78 per lb, the highest level for the second month in more
than 30 years.
Coffee prices soared to record levels in 1977 after severe
frost cut the 1976/77 Brazilian crop to around 9.3 million bags
from an expected 22 million.
Dealers said that buying by roasters was limiting any
downward moves.
"Roasters seem to be not as well covered as was thought,
given you see buying every time the market dips," Haque said.
Robusta coffee futures on Liffe also rose with May LRCc2
peaking at $2,417 a tonne, the highest level for the second
month since March 2008. Prices subsequently slipped back to
$2,392 a tonne, still up $5 or 0.2 percent.
Sugar prices were also higher, boosted by the prospect of
increased imports into the European Union.
A European Union committee will vote on Thursday on whether
to open a new import quota for sugar at reduced duties, to ease
a supply shortage on the EU market, the European Commission said
on Monday. [ID:nLDE71K1II]
"The strength of the markets this morning may be as a result
of a vote by an EU committee on Thursday on whether to open a
new import quota for sugar at reduced duties to ease a current
supply shortage," Sucden Financial said in a market note.
"If approved, there would be increased imports of both
whites and raw sugar from the world market," Sucden added.
March raw sugar futures on ICE SBc1 rose 0.32 cent or 1.0
percent to 31.34 cents a lb while May whites on Liffe LSUc1
climbed $3.80 to $728.30 per tonne.
source: http://af.reuters.com/article/commoditiesNews/idAFLDE71L1AB20110222
