Cocoa tumbles

Cocoa futures turned lower on Friday, falling below the 100-day moving averages in both London and New York after the US market had jumped to a 2-1/2-month high. Sugar and coffee also fell after data showed the US economy grew less than expected in the fourth quarter.
Cocoa futures on ICE dropped more than 2 percent after hitting the highest levels since mid-November, hitting resistance at the 100-day moving average at $2,490 per tonne, basis March. The market could not sustain gains from a short-covering rally that boosted prices around 7 percent on Tuesday.
March cocoa on ICE dropped $46, or 1.9 percent, to settle at $2,406 a tonne, after peaking at $2,480, the highest level for the front month since mid-November. "It's been a very strong run. The market's up $500 in a very short period of time," said one veteran cocoa dealer in New York.
The benchmark March contract has climbed $477, or 23 percent, in the past three weeks, during which time there were two multi-day rallies. Liffe March cocoa futures closed down 28 pounds, or 1.8 percent, at 1,563 pounds a tonne, falling after hitting their 100-day moving average at 1,603 pounds.
Dry and windy weather since November has dampened output prospects for the end of Ivory Coast's October-to-March main crop. "In top producer Ivory Coast, concerns centre on the potential impact of recent heavy winds, thus jeopardising the previous bumper output prospects," said Natixis in a commodities note.
Raw sugar futures prices posted the biggest fall in three weeks, after failing to break above technical resistance around 25 cent per lb. March raw sugar futures on ICE dropped 0.52 cent, or 2.1 percent, to end at 24.21 cents a lb, its biggest one-day fall since January 5. The contract rose to 25.21 cents on Tuesday, the highest for the front month since mid-November.
New York sugar will rise to 25.21 cents per lb as a rebound from the January 11 low of 23.03 cents could have extended, according to Reuters market analyst Wang Tao. London March white sugar futures fell $10.70, or 1.7 percent, to settle at $637.70 per tonne. Arabica coffee prices on ICE eased with March closing down 2.35 cents, or 1.1 percent, to finish at $2.1735 per lb. March robusta coffee on Liffe eased $7, or 0.4 percent, to end at $1,865 a tonne. Certified robusta coffee stocks held in NYSE Liffe nominated warehouses fell to 235,840 tonnes as of January 23, from 246,580 tonnes on January 9, exchange data showed.