New York cocoa futures on ICE took their biggest one-day tumble in nearly 11 months on Tuesday, falling sharply below the prior session's 1-1/2 year high on profit-taking, while arabica coffee prices turned higher after setting a nine-month low.
May New York cocoa settled down $137, or 5.2 percent, at $2,498 per tonne. This was the spot contract's biggest one-day drop since May 2017. Prices were pressured by profit-taking by funds holding long positions, traders said.
The sharp drop came after total open interest reached an 11-month high at 304,550 lots on Monday, when prices hit a 1-1/2-year high at $2,647, ICE data showed. As of March 27, government data showed speculators held their biggest net long position since August 2016. "A lot of people have been hanging on to these long positions. We're seeing them exit after the long weekend," said Peter Mooses, senior market strategist for RJO Futures in Chicago. "We've been talking about it being so overbought for a month, still they are saying production is going to be pretty light and there's no new news to hold it up. That's getting people out of the market."
May London cocoa settled down 20 pounds, or 1.1 percent, at 1,733 pounds per tonne. May arabica coffee settled up 0.2 cent, or 0.2 percent, at $1.166 per lb, after falling to a low of $1.16, the weakest level for the front month since June 2017.
The market was attempting to consolidate after a prolonged downtrend driven largely by the prospect of a large crop in top grower Brazil this year, dealers said. May robusta coffee settled up $14, or 0.8 percent, at $1,739 per tonne. May raw sugar settled down 0.05 cent, or 0.4 percent, at 12.47 cents per lb. This was not far from last week's 2-1/2-year low of 12.18 cents. Rising production in India and Thailand continued to pressure prices, traders said.
May white sugar settled up $3.50, or 1 percent, at $354.70 per tonne.
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