Liffe cocoa soars

Liffe May cocoa closes 60 pounds higher at 2,102 pounds a tonne on Thursday after climbing to a 5-month high of 2,105 pounds, after failed mediations in top grower Ivory Coast and a fire in a Dutch cocoa factory added to fears about possible supply disruptions.
Liffe March robusta coffee ended down $4 at $2,115 a tonne tracking a setback in many other commodity markets after stronger-than-expected Chinese growth data raised the prospect of tighter monetary policy in the world's second-largest economy. Liffe March white sugar ended $3.30 lower at $768.30 per tonne, as the potential for tighter Chinese monetary policy knocked crude oil and other commodity markets.
Cocoa traders were watching developments in Ivory Coast where a mediator said talks to resolve a disputed election had failed, raising the possibility of harsher sanctions or military force that could disrupt cocoa shipments. A fire that broke out in an Archer Daniels Midland Co cocoa processing plant in the Netherlands late on Wednesday added to price firmness, traders said, although it was unknown how much cocoa had been damaged.
"The story of the fire...has sent (prices) up a bit," a London-based trader said. "Until it stabilises and we know what's been damaged, the market will stay steady." Another trader said the factory fire reinforced a market already driven up by the Ivory Coast dispute. "Concern about Ivory Coast is still the dominant factor, and the fire ... has just given the market a bit of a tonic first thing this morning," the trader said.
"The overall picture is already of firmness. ... We're looking to see if the (Ivory Coast) financial sanctions bite." Cocoa output from Ivory Coast, the world's top grower, is running 1.4 percent ahead of last year despite a political crisis, according to official figures obtained by Reuters on Thursday. Rival presidential claimant Alassane Ouattara told Reuters on Thursday that any economic sanctions directed against Ivory Coast should not target the population, where many farmers depend on cocoa for subsistence.
Traders said sugar would remain range-bound as long as concerns about the crop outlook in key producers India and Australia persisted. Traders predicted the market was poised to go higher given underlying tight supplies of arabicas. "You saw people looking at other commodities and thinking (coffee) might be due for a fall," a London-based commodities trader said.