Cocoa futures trading on ICE Futures US surged nearly 5 percent to a 28-year high early Thursday on heavy support from the strong sterling and fund buying, traders said. Arabica coffee futures were also firm on the weak dollar.
"Funds are buying and the dollar," one cocoa trader said, noting the weak US currency relative to the pound was supportive. The benchmark ICE May cocoa contract jumped $119, or 4.3 percent, to $2,892 per tonne by 9:18 am EDT (1318 GMT), trading from $2,797 to $2,903, a high dating back to April 1980 for the second position on a monthly continuation chart.
The rest soared from $85 to $124. The strong sterling relative to the dollar can attract arbitrage buying on the US cocoa market. Meanwhile, a strike over pay by dock workers at ports in Ivory Coast went into its fourth day on Thursday, halting the loading of export shipments from the world's top cocoa producer, shippers and exporters said. The ICE benchmark May coffee contract climbed 3.00 cents, or 2 percent, to $1.5695 by 9:21 am, moving from $1.545 to $1.576 per lb. The rest were 0.05 to 3.30 cent higher.