ICE cocoa hits fresh low

ICE cocoa hit a fresh 2-1/2 year low on Friday, while sugar arabica coffee futures edged up, supported partly by a slightly weaker dollar but concerns about the deepening debt crisis in the eurozone helped to cap gains. World stocks remained near their lowest levels since October and commodities were weak on persisting fears the eurozone's debt crisis is spiralling out of control.
"The entire world is focussing on Europe and there's a lot of speculation on what might happen with the eurozone; how they're going to pay off all this debt, plus there's a lot of political uncertainty," said Jeremy Gatto, head of trading at commodities hedge fund Tiberius Asset Management.
ICE cocoa prices slipped to a 2-1/2 year low, with ample supplies keeping the market on the defensive. "Industry is fairly well covered with around 10-13 weeks of working stocks, they're scale-down buyers," said a London-based broker. ICE March cocoa traded down $31 or 1.2 percent at $2,474 a tonne at 1513 GMT, after dipping to $2,470, the lowest level for the second month since July 2009.
Port arrivals picked up from top producer Ivory Coast, although still lagging last year's pace, with farmers reluctant to sell into a falling market. London March cocoa futures traded down 24 pounds or 1.5 percent at 1,580 pounds a tonne. Raw sugar futures edged up, rebounding slightly from the prior session's five-month low, with the front-month hovering around the key technical level of 24 cents/lb.
ICE March raw sugar futures rose 0.12 cent or 0.5 percent to 24.15 cents a lb. The contract dipped to 24.00 cents on Thursday, the lowest level for the front month since June 7. "The trend is still lower and should the 24 cent level be breached, we would of course anticipate sell stops being elected," said Nick Penney of Sucden Financial. Dealers said further physical offtake was expected at these levels following Malaysia's purchase of raw sugar.
Malaysia's cabinet is expected to approve a purchase of slightly less than three million tonnes of raw sugar in the next few weeks, a Malaysian industry source close to the deal told Reuters on Friday. March white sugar futures on Liffe were down $0.50 at $628.50 per tonne. January robusta coffee on Liffe was up $4 or 0.2 percent at $1,857 a tonne.