Liffe cocoa soars

Liffe September cocoa closed at 2,445 pounds per tonne, up 26 pounds on Friday. Nearly all the physical stocks of cocoa that back futures trading of the commodity in London were snapped up on Friday after the July contract expired, fuelling fears of a September supply crunch.
Liffe front-month August white sugar futures settled at $582.70 per tonne, up $8.70. A small delivery is expected against the August contract, which expired on Friday. Liffe second-month robusta coffee settled at $1,764 per tonne, up $11. Dealers said the market was supported by fund interest.
Day earlier, cocoa futures boosted by a huge delivery against expiry of the July contract and strong demand data, while sugar dipped underpinned by loading delays in Brazil, and arabicas edged up in thin trade. Liffe cocoa rose as dealers noted the exchange's largest delivery for nearly 14 years on Friday with 240,100 tonnes tendered against the expiry of the July contract, according to exchange data.
The delivery was the largest since more than 300,000 tonnes were delivered against the September 1996 contract. Dealers said a big delivery to one player could signal a supply crunch on the September contract. "If the receiver continues to be long, the September will go up," one cocoa analyst said. North American grind data provided further evidence that demand is reviving after last year's recession-linked dip.
Cocoa grindings in Canada, the United States and Mexico in the second quarter were up 12.07 percent from the same period in 2009 at 117,657 tonnes, data from the National Confectioners Association (NCA) showed. The rise was well above the range of trade estimates that pegged the grind would climb 4 to 8 percent.
A 12.7 percent rise in Europe's cocoa grind announced earlier this week also exceeded trade forecasts which averaged about eight to nine percent. "ICE cocoa prices have gained traction on the back of the release of Q2 grindings data," Barclays Capital said in a daily market report.
Data released by the National Confectioners Association (NCA) showed North American (US, Canada and Mexico) second quarter cocoa grindings came in up 12.07 percent year-on-year and well above market expectations, Barclays Capital said. Raw sugar futures fell slightly, supported by lengthy delays in loading new-crop sugar at congested ports in Brazil, exacerbated by rainfall.