London cocoa futures closed higher on Tuesday, recouping the previous session's losses with the market focused on arbitrage trade with New York. "We tend to be range-bound. We had a little run up on the dollar, there was short-covering in New York above $1,585," a dealer said. Liffe's front-month March contract rose 12 pounds, or 1.41 percent, to settle at 862 pounds a tonne. It traded between 850 and 866 on turnover of 2,148 lots.
Second-month May rose 12 pounds to 873 pounds per tonne on volume of 1,652 lots. Dealers said there was little buying going on and industry interest was seen to be below the market.
The December contract gained 13 pounds to settle at 892 pounds per tonne in volume of 1,639 lots.
Overall 6,973 lots changed hands. Evidence of less supply from West Africa also lent support to the market.
Cocoa arrivals at top grower Ivory Coast's port of San Pedro reached 351,642 tonnes between October 1 and February 6 this year, down from 458,703 tonnes delivered in the same period of the 2003/04 season, data from the Coffee and Cocoa Bourse (BCC) showed.
COFFEE SURGES: London robusta coffee futures ended higher on Tuesday after fund and speculative buying in New York turned the market around in late trade, dealers said.
Liffe's benchmark May rose $14 to finish at $859 a tonne after turning over 5,912 lots in an $860-830 price band. Overall turnover was 10,115 lots.
The contract had been retreating from a peak of $872 touched last week, the highest since February 12, 2003.
"It is follow through buying in London - every Tom, Dick and Harry - led by fund and spec buying in New York," one trader said.
Both arabica and robusta have enjoyed a rally since November but market talk has focused recently on an eventual liquidation by funds that have built up historically high long positions.
The speculative net long position in New York stands at over 40,000 lots.
Trader estimates for the net long position in Liffe coffee range from 25,000 to 28,000 lots.
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