Liffe January robusta coffee ended $67 lower at $1,826 per tonne on Friday. Market slipped back after a strong advance earlier in the week to a two-year peak as further indications on the outlook of the crop in Vietnam are keenly awaited. Liffe front-month December white sugar ended $17.00 lower at $706.90 per tonne. Dealers saw the setback as an overdue correction following a prolonged advance in prices, which saw the market hit an 8-month high earlier this week.
Liffe second-month March cocoa ended 25 pounds higher at 1,948 pounds a tonne. Market supported by constructive charts with dealers keeping a close watch on activity in Ivory Coast in the lead up to elections due later this month. "The current must-have popularity of agricultural commodities and accompanying fund buying is defying anybody to call a top," Ralph Hawes at Sucden Financial said.
Dealers said world coffee production may fall short of expectations if key growers including Colombia and Vietnam revise output figures lower. "The crop is earlier than last year but it seems there's been a bit held back, they're waiting for pre-election hype for a better price," a European trader said. Ivory Coast is the world's number one cocoa producer and cocoa is its largest export.
"It's very strange that they put the elections right in the middle of the main crop," another European trader said. Ivory Coast's electoral commission insisted on Thursday that October 31 polls would be held on time. "Weather concerns in Brazil continue to impact the current crop, whilst also escalating the risk premium for the 2011 harvest," Rabobank analyst Andy Duff said in a market note. "Similarly, evidence of strong global demand persists, with cash prices in a number of major markets keeping pace and even exceeding the gains seen in the futures market," he added.
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