Cocoa futures galloped to a five-month high on Wednesday as the collapse of talks to resolve a bitter presidential contest in top grower Ivory Coast stirred fears of supply disruptions from the African country. Sugar was mixed, while coffee dipped as funds considered selling long positions in that market.
Macroeconomic factors bolstered the softs complex. World equities hit their highest in nearly 2-1/2 years and the dollar dipped to eight-week troughs, making dollar-denominated commodities cheaper in terms of other currencies. New York's March cocoa contract climbed $64 or by over 2 percent to close at $3,100 per tonne, the highest settlement close for the spot contract since August.
Volume in the US cocoa market was at a two-month high near 33,000 lots as players scrambled to hedge against the risk supplies from Ivory Coast may not get out at all. Traders also cited technically motivated buying for cocoa's surge, but the Ivorian situation dominated market sentiment. The March arabica coffee contract on ICE Futures US fell 2.85 cents to close at $2.325 per lb. The March raw sugar contract went up 0.06 cent to conclude at 31.18 cents per lb.
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