Liffe coffee, cocoa and sugar rise

12 Feb, 2010

May robusta coffee finished $6 higher at $1,331 per tonne on Thursday. Market boosted by broad-based advance in commodity markets as a deal by European leaders to give aid to debt-laden Greece helped to boost the risk appetite among investors. May cocoa on Liffe ended 34 pounds higher at 2,256 pounds a tonne. Advance seen as largely technically driven, with system funds among key buyers, with the market oversold after a prolonged slide in prices.
March white sugar ended $0.60 higher at $745.10 a tonne. Market underpinned by advance in ICE raws but main focus remained Friday's expiry of the front month contract with some estimating that around 100,000 tonnes would be tendered. Earlier, raw sugar, cocoa and coffee futures on ICE rose on Thursday, boosted by an advance in commodity markets and a technical bounce following the market's prolonged slide.
"It is macro and technically driven," one London dealer said. Another said: "It's been system fund buying. The market ignored rioting in (top producer) Ivory Coast this week. For the same reason I think the market ignored today's news of suspension of voter registration. Today has been technically driven."
Ivory Coast suspended its voter registration process indefinitely on Thursday because of rising tensions, the government said, casting doubt on when the long delayed presidential election would take place. The process of registering voters has been tortuous and fraught with disputes over Ivorian nationality and who is eligible to vote - explosive issues in a country that went to war over them.
Rioters burned down a government building in rebel-held western Ivory Coast on Tuesday. Dealers said the next upside target was $3,140. The contract fell sharply after trading as high as $3,512 on January 21, touching a low of $2,990 on Monday before rebounding with the market seen technically oversold.

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