Buoyed by an ailing pound, London cocoa jumped on speculative and fund buying to a three-week peak on Friday, dealers said. The market drew technical buying by speculators after cocoa for December delivery broke through 814/815, 825 and then 835 pounds a tonne.
It ended 4.2 percent higher at 841 pounds a tonne - the highest closing price since October 14. It earlier hit a session high of 847.
Total volume soared to 29,288 lots as producers, trade houses and speculators took the opportunity to sell. December traded 12,338 lots while March cocoa, which also gained 4.2 percent to conclude at 866, moved 14,029 lots.
"Currency was always going to be a major supportive factor," a dealer said. "The buying was well fed by trade and origin."
Sterling fell to a two-year low against the dollar and a one-month low against the euro.
Traders said cocoa's rally was unlikely to last though because it stemmed from technical rather than fundamental factors.
"Nothing fundamental has changed...The overall picture is that we have got good supply," a second dealer said.
West Africa is expected to provide an ample harvest for the 2005/06 season although supplies have slowed recently as producers in countries such as Ivory Coast and Ghana hold out for higher prices. Demand from chocolate manufacturers and cocoa processors has been moderate.
SUGAR WEAKER: London white sugar futures settled slightly weaker on speculative and trader selling on Friday, traders said.
"I think the March contract in London has some trouble staying above $300," one trader said, noting there was some profit-taking following a run-up earlier this week.
Front-month March, which climbed to a 3-week high of $301.30 per tonne on Thursday, concluded down $2.20 at $296.80 per tonne, having moved from $296.20 to $299.50. Volume on the March contract was a light 1,470 lots.
Traders said next week's meeting of European Union agriculture ministers would be closely monitored.
Ministers will consider a radical proposal that calls for sharp cuts to minimum prices and production quotas - slashing the EU's white sugar support price by 39 percent and the minimum beet price by 42 percent. British Sugar, a unit of Associated British Foods, and the National Farmers' Union (NFU) have jointly urged UK growers to cut their beet crop by 3.5 percent in 2006 in response to EU sugar reform plans.
COFFEE STEADIES: Liffe coffee futures finished barely changed on Friday on lack of direction from either fundamental or technical factors, dealers said.
Volume was thin, totalling 3,377 lots. London's most-active January contract finished $5 up at $1,046 a tonne on volume of 2,287 lots. The range was $1,040-1,056.