New York cocoa slides on producer, fund sales

New York benchmark cocoa futures fell almost four percent Tuesday as Ivory Coast exporters recover from last week's industry stoppage caused by days of violence in the world's No 1 cocoa producing nation. With Ivorian cocoa farmers enjoying high prices and some exporters reportedly bringing in as many as 6,000 tonnes of beans a day, it is a clear signal to the market that the industry has regained some normality, analysts said.
"We are getting some origin selling and some long liquidation from funds," said Boyd Cruel, an analyst at Alaron Trading.
New York Board of Trade's most-active March cocoa eased $68 or 3.8 percent to settle at $1,685 a tonne, after dealing from $1,678 to $1,730. More distant futures declined $55 to $64.
Cocoa futures surged more than 20 percent since Ivory Coast unrest began two weeks ago, but prices have since retreated on signs of stability to the lucrative Ivorian cocoa business.
During the unrest, cocoa buyers relied heavily on other top cocoa-growing nations, such as Ghana and Indonesia.
One trader said there was market talk that some 50,000 tonnes of beans were sold last week from Ghana, the world's second biggest cocoa grower.
Meanwhile, the 15-nation United Nations Security Council unanimously adopted a French resolution of an immediate arms embargo Monday.
The move came after Ivorian President Laurent Gbagbo's forces bombed the rebel-held north two weeks ago, breaking an 18-month truce. The bombing raid infuriated Paris after one attack killed nine French peacekeeping soldiers.
France struck back by destroying virtually all of Gbagbo's air force, which triggered days of anti-French riots and looting that forced thousands of foreigners to flee the former French colony and foreign-owned businesses to shut down. The lingering tension has sidelined market players, considering the relatively thin trading volumes.
NYBOT total trading volume just before the market closed was estimated at 3,332 lots, compared with 5,116 lots in the previous session. Open interest in cocoa futures rose 1,213 lots to 116,914 lots as of November 13.
On the charts, traders put technical support for the March contract was $1,675 and then at $1,643, with resistance at $1,700 and then at $1,800.