London cocoa futures finished slightly lower on Thursday as the market consolidated following a two-day decline that has weakened prices to a two-week low, dealers said.
Futures - basis December - made a brief rebound in afternoon trade to 953 pounds when New York opened higher than expected but speculator selling pushed them back down again so that Liffe's benchmark December ended 7 pounds lower at 931 pounds a tonne.
The day's low was 921 pounds while volume reached 3,036 lots from a total of 4,370.
"It's been volatile as the market looked for direction. We've had a good couple of days down and in retrospect it looks like it's consolidating today," a trader said. Industry buyers who took advantage of Wednesday's more than five percent drop seemed to be absent Thursday, the floor source added.
Pressure from origin selling on Tuesday and fund liquidation on Wednesday has trimmed about nine percent off a rally that started in early July, leaving most traders sceptical that the market will achieve another surge over August 4's seven-month peak of 1,022.
The fundamental outlook has turned bearish too as Ivory Coast weather conditions have improved, prompting reports of a better than previously expected harvest.
"I think it (the market) still looks weak, if funds don't sell we might manage a rally but the Ivory Coast crop will be out soon and then we'll be in the full swing of hedging," the trader said.
Cocoa farmers and buyers in the centre of the West African country told Reuters on Thursday that the main crop season now starting should produce an abundant harvest, despite production delays caused by lack of rainfall.
Dry weather in June and July had stoked concern about damage to the main crop.