Cocoa gained to the highest level in almost 11 months in London on speculation dry weather in top growing region West Africa will damage the next crop just as Ivory Coast has already sold most of its beans. Sugar rose.
Bean sales from the next harvest in Ivory Coast have reached 750,000 metric tons, according to Macquarie Group Ltd. in London. The forward sales may reach 80 percent of the harvest by mid-August, the bank said in a report on July 19. Ivory Coast’s Daloa region, which produces about 300,000 tons of cocoa a year, got 0.1 millimeters (0.004 inches) of rain from July 21-31, according to the National Meteorological Service. That compares with the long-term average of 34 millimeters.
“Forecasts look for a net drying bias over the next two weeks in growing areas of the Ivory Coast,” Sterling Smith, a futures specialist at Citigroup Inc. in Chicago, said in a report e-mailed yesterday. “While some light rains are expected, they will not be able to keep up with the evaporation being seen.”
Cocoa for September delivery rose 1.8 percent to 1,674 pounds ($2,596) a ton by 11:07 a.m. on NYSE Liffe. The price touched 1,678 pounds, the highest since Sept. 17. Cocoa for September delivery rose 1.9 percent to $2,504 a ton on ICE in New York.
Ivory Coast is in its mini-dry season, when rains move north of the cocoa belt. The nation’s output will fall for a third year to 1.42 million tons in the 2013-14 season that starts in October, estimates Kona Haque, an analyst at Macquarie Group Ltd. in London. Production is forecast at 1.455 million tons in the current year, according to the bank.
“Rainfall typically improves as we move into September,” Smith said. “However, this will have to be closely monitored, and if they do not improve, production losses can be significant.”
Robusta coffee for delivery in September was 0.5 percent higher at $1,904 a ton on NYSE Liffe. Arabica coffee for September delivery gained 0.3 percent to $1.2135 a pound on ICE.
Arabica coffee gained as much as 3.1 percent yesterday after the Brazilian government announce measures to support growers. The nation will offer to buy as many as 3 million bags of the commodity at above-market prices through options contracts to aid growers as futures trade near a four-year low.
White sugar for October delivery was 0.2 percent higher at $495.40 a ton in London. Raw sugar for delivery in October advanced 0.3 percent to 16.83 cents a pound in New York.
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