Cocoa futures fell on Friday as a short-covering rally seemed to run out of steam, while robusta coffee eased as Brazil underwhelmed the market with modest plans for imports. New York May cocoa fell $11, or 0.54 percent, to$2,031 per tonne by 1500 GMT, snapping a dramatic two-day corrective rally. Prices hit 8-1/2 year lows earlier in the week due to selling related to defaults in top grower Ivory Coast, which in turn triggered a wave of short-covering.
Dealers noted the market was now consolidating from the sharp swings this week, although fundamentals remained bearish. "Is it game over? Are we going to fall back in on ourselves? It's a technical possibility," said one dealer. "But in the big scheme, we've had a significant downward trend, so some sort of consolidation action is probably warranted."
May London cocoa also fell 4 pounds, or 0.24 percent, to 1,649 pounds per tonne, after gaining 2.4 percent in the previous session. Earlier in the week, it hit a 3-1/2 year low. New York cocoa is still on course for a 3.5 percent gain this week, while London cocoa is poised to climb 2.4 percent. May robusta coffee eased $9, or 0.41 percent, to$2,170 per tonne, after gaining 1.4 percent in the previous session.
Brazil said on Thursday it has approved imports from Vietnam, with plans to allow 1 million 60-kg bags to be imported under a quota that would run until the end of May.
Dealers remained sceptical, saying the details were still "murky" and the quota would have limited impact on the global coffee market, as it seems mostly designed for the solubles industry.
"One million bags of arabica with a tariff - I don't think that was the statement the market was looking for," one said. May arabica coffee rose 0.95 cent, or 0.64 percent, to $1.4935 per lb. Raw sugar eased further, with the March contract down 0.05 cent, or 0.25 percent, at 20.31 cents per lb.
May white sugar was $2.30, or 0.42 percent, lower at $549.40 per tonne. The white sugar premium remained near a three-month high touched on Thursday. The market has been betting that India will start importing white sugar later this year, although a decision is not expected until the results of state elections next month.