US cocoa futures closed at a three-week high on Monday, on fund and speculative buying, supported by the delayed mid-crop out of Ivory Coast due to hot, dry weather this year, traders said.
"You don't have a lot of cocoa out there right now until the main crop comes in October, so without that pressure it looks like the funds and the speculators are having their way," one trader said. The New York Board of Trade spot-month July contract climbed $55 to finish at the session high $1,959, moving as low as $1,899.
Benchmark September futures rose 1.6 percent, or $31 to $1,964, after trading in a band from $1,920 to $1,967, a high dating back to May 25. The rest ended from $31 to $33 higher. It was the first notice day for the front-month contract on Monday.
The September contract trading on the IntercontinentalExchange NYBOT electronic platform was up $30 at $1,963, at 12:51 pm, while the rest settled up $18 to $29, one contract aside. Electronic trading ends at 3:15 pm. "Since December we have been in an upturned that's very well defined and we held that upturned on the last pull-back so technically the trend continues up," one broker said, adding that the funds are still long.
Key resistance for the September contract was around $2,000, dealers said. Life's September cocoa futures contract climbed 11 pounds to settle at 1,079 pounds, with deals spanning from 1,058 pounds to 1,080 pounds. The key contract has climbed nearly 6 percent since its lowest trade on June 13, but sits below the near four-year high hit in mid-April.
NYBOT estimated open-outcry volume around noon at a light 1,005 lots, compared with the 4,932 contracts that traded in open-outcry on Friday, when 24,871 contracts traded on the ICE electronic platform. Open interest rose by 1,513 lots to 143,106 as of June 15.
Meanwhile in the top cocoa producing nation, rains eased last week in most of Ivory Coast's cocoa zones, farmers and an agronomist said on Monday, following weeks of regular showers which have helped trees sprout new leaves and blossom flowers.
Cocoa arrivals at ports in Ivory Coast from October 1 to June 17 reached around 1,116,000 tonnes, compared with 1,229,800 tonnes received in the same period a year earlier, exporters said on Monday. In related news, Brazil's cocoa grind totalled 19,129 tonnes in May, up 8 percent from 17,718 tonnes a year-ago, cocoa analyst Thomas Harman said on Friday, citing Brazilian Cocoa Industry Association (AIPC) data.