Cocoa futures dropped to a nine- month low on mounting concern that a recession is weakening demand in Europe, the world’s biggest consumer. Orange juice and sugar also fell, while coffee and cotton gained.
European stocks declined today and the pound weakened through $1.50 for the first time since July 2010, after an industry report showed U.K. manufacturing unexpectedly shrank in February. The economies of the 17 countries that use the euro will shrink 0.1 percent this year, after contracting 0.5 percent in 2012, according to the median of 54 estimates in a Bloomberg survey of economists.
“We always have to look at the idea of a poor global economy leeching away demand from commodities, cocoa included,” Hector Galvan, a senior commodities broker at RJO Futures in Chicago, said today in an e-mail.
Cocoa for May delivery fell 2.5 percent to $2,082 a metric ton at 2 p.m. on ICE Futures U.S. in New York, the biggest drop for a most-active contract since Jan. 22 and the lowest closing price since June 1. In London, cocoa for May delivery fell 1.6 percent to 1,406 pounds ($2,112) a metric ton on NYSE Liffe, marking a 19 percent drop from a closing high on Sept. 6.
Also in New York, orange-juice futures for May delivery tumbled 5.4 percent to $1.2095 a pound on ICE, the biggest loss since Dec. 31.
“There are no weather concerns, so people are getting out,” after money managers boosted their bets on a rally during the past two weeks, John Ortelle, a vice president for McKeany- Flavell Co., a broker in Oakland, California, said in a telephone interview.
While a cold snap approaching the northern sections of Florida’s citrus belt will drop temperatures to the upper 30s Fahrenheit (3.3 degrees Celsius) on March 3, it will not pose a threat to orange groves, Joel Widenor, the director of agricultural services for Bethesda, Maryland-based Commodity Weather Group LLC, said today in a telephone interview.
Raw-sugar futures for May delivery retreated 2.6 percent to 17.91 cents a pound in New York.
Coffee futures for May delivery gained 0.1 percent to $1.4335 a pound on ICE, while cotton futures for delivery in May advanced 0.1 percent to 85.4 cents a pound.
To contact the reporters on this story: Oliver Renick in Chicago at firstname.lastname@example.org; Marvin G. Perez in New York at email@example.com
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org