ICE cocoa futures fell more than 3 percent amid profit-taking on Monday, changing direction after initially extending the prior session's rally on fears the spread of the Ebola virus could limit cocoa supplies. Arabica coffee on ICE Futures US turned lower after failing to reach a peak not seen since January 2012, initially buoyed by concerns about dry weather in top grower Brazil's coffee belt as some trees began to flower. Sugar rose.
December cocoa dropped $98, or 3.1 percent, to settle at $3,059 a tonne, after initially rising 1.6 percent to $3,208 on follow-through buying from Friday, when cocoa posted its biggest single-day leap since late January. The move down took the contract below the 100-day moving average at $3,138. "It was overbought, no doubt about it," said one veteran US cocoa dealer. "There was some spec profit-taking. You have some guys on Friday who bought, (now) spitting it out."
Front-month prices peaked at $3,399 about two weeks ago to set a 3-1/2-year high on concerns Ebola could spread to top producer Ivory Coast. But prices receded last week as fears subsided after reports other West African countries had limited outbreaks. Reported cases outside West Africa dimmed confidence that Ivory Coast and Ghana, which together make up for more than one-half of world cocoa production, can prevent the spread. December cocoa on Liffe fell 55 pounds, or 2.7 percent, to end at 1,998 pounds a tonne.
Looking ahead to data due on Tuesday, dealers said they expected third-quarter European cocoa grind data, a measure of demand, to be flat to slightly weaker. December arabica coffee on ICE fell 2.30 cents, or 1 percent, to close at $2.1810 per lb, after earlier facing strong resistance while rising to $2.2545 and nearing the October 6 peak of $2.2550 a lb - the highest since January 2012.
High temperatures and a lack of rain this week were expected to punish Brazil's drought-stressed coffee and sugar cane areas for another week, threatening to sap more of their productive potential this season, forecasters said on Monday. November robusta coffee futures on Liffe rose $10, or 0.5 percent, to close at $2,169 a tonne. January ended up $13, or 0.6 percent, at $2,189 per tonne.
Raw sugar prices rose, taking back losses in the prior session, with the March contract climbing 0.12 cent, or 0.7 percent, at 16.67 cents a lb. The market drew support from a slowdown in the cane crush in Brazil's center-south region in the second half of September. December white sugar futures on Liffe rose $1.90, or 0.5 percent, at $424.30 per tonne.
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