London cocoa futures closed nearly three percent lower on Tuesday, with prices under pressure from reports of increased exports from Ivory Coast, traders said. Liffe's most-active March contract settled 29 pounds lower at 945 a tonne, well off the 11-week contract peak of 1,032 reached last week at the height of political turmoil and anti-French mob violence in the troubled West African state.
"The flow of cocoa is better and it's moving to ports but the political issues are starting to build up like a pressure cooker in the background," one floor source said.
Dealers and analysts expect prices to remain in the wide 921-961 pound range seen over the past week until cocoa exports pick up pace or fresh conflict breaks out.
Some question the Ivorian cocoa industry's ability to bounce back from last week's clashes and the exodus of so many workers involved in the sector.
Front-month December settled 29 pounds softer at 928 pounds and turned over 1,595 lots in a 959-925 range.
Total volume was 5,213 lots, with March making up most of the volume at 2,365 lots.
Ivory Coast exporters were taking advantage of rising supply and higher prices to make up ground lost due to last week's violence, industry managers in Abidjan said on Tuesday.