NEW YORK/LONDON, April 13, 2011 - Cocoa futures climbed on Wednesday due to worries about possible disruptions to the mid-crop harvest in Ivory Coast even as cocoa exports were set to resume from the world's top grower after months of political turmoil.
Cocoa futures have slid around 25 percent since peaking at a 32-year high in March as Ivory Coast has looked closer to resuming exports after the civil war there was resolved with the arrest of leader Laurent Gbagbo.
"Now that everything is settling down in the Ivory Coast, there may be more of a normality in the market," said Nick Gentile, head of trading at commodities fund Atlantic CapitalAdvisors.
New York's July cocoa contract on ICE Futures U.S. gained $14 to end at $3,070 per tonne. London's July cocoa rose 9 pounds to close at 1,946 pounds per tonne.
The market's focus shifted to the first-quarter European cocoa grind data and U.S. cocoa grind data. Both key indicators of demand are due out on Thursday.
"We'd expect it to be a little bit up due to the fact there's been no grinding in Ivory Coast. If it's not up, it's bearish," the dealer said, estimating grindings would increase by 2 percent or 3 percent.
A second dealer said, "We expect ECA grindings to be slightly better due to replacement from Ivory Coast."
International trade house and cocoa processor Archer Daniels Midland Co. (ADM) , whose operations in Ivory Coast have been suspended since the first week of March, said in an emailed statement: "We're currently leveraging our cocoa processing operations in Ghana, Singapore, Brazil, the United States and Europe to meet our customers' needs."
Ivory Coast's major port of Abidjan remained shut on Wednesday as staffing and logistical issues meant operations could not resume, shipping sources said.
"The trade has bought so much cocoa from Ghana, from Togo, to hedge against Ivory Coast, now they've got their hedges and they've got their cocoa from Ivory Coast too. Now they have too much of everything so they are moving out of their positions," a long-time U.S. based analyst said.
U.S. cocoa futures were also bolstered by technical strength after rising above the 200-day moving average and after the 20-day and 100-day moving averages crossed above the market late last week.
Source : reuters
