London cocoa hits contract high

December cocoa ended 41 pounds higher at 2,018 pounds per tonne on Friday, having earlier touched a contract high of 2,025 pounds per tonne on technical buying, strong fundamentals and the weak pound which makes sterling-denominated futures better value in terms of other currencies.
November robusta coffee closed $11 lower at $1,513 per tonne, with origin selling interest overhanging the market. December white sugar ended $6.10 lower at $579.90 per tonne, pushed lower by the firmer dollar and falling oil prices. Earlier, ICE Cocoa futures rose to near 14-month highs and Liffe cocoa touched contract highs on technical buying and strong fundamentals on Friday, with the London market getting a boost from the weak pound.
Sugar and coffee futures fell, pressured by a firmer dollar and falling oil prices, dealers said. Cocoa appeared well-supported, buoyed by expectations of improving demand as the global economy showed signs of recovery and by concerns over output in top grower Ivory Coast. Concern over ageing trees in Ivory Coast, and worries over the possible impact of the El Nino weather pattern on production in countries such as Indonesia and Ecuador, bolstered prices.
"You can't feel anything but bullish about the market," Rabobank soft commodities trader Nick Hungate said. Cocoa futures have rallied over the past eight sessions, peaking at a 14-month high of $3,150 per tonne in New York on Wednesday, amid improving demand prospects and concerns over supplies from Ivory Coast. "The market's all about momentum, especially when you get to the highs where we are at, at the moment," a cocoa trader said, noting the funds have been buying.
"It continues from strength to strength," he said. "I'm sure we'll see further new highs at some point. Liffe cocoa also gained support from weak sterling which slumped to a four-month low against the euro as concerns were raised about the fragility of the UK banking sector. The easing of sterling makes London cocoa better value in terms of other currencies. Meanwhile, the macroeconomic picture pushed sugar and coffee futures lower.