Cocoa prices at multi-month high

Cocoa-Beans1Cocoa-Beans1Cocoa bucked the commodity complex’s weak trend and rallied to the highest in nearly nine months on crop concerns and technical buy signals.

Traders said cocoa futures garnered support from crop concerns in West Africa, where roughly 70 per cent of the world’s beans are produced.

Intense downpours flooded plantations, damaged roads and spawned fears of disease in top grower Ivory Coast, while dry weather in Nigeria’s biggest cocoa region caused trees to produce shriveled mid-crop pods.

July London cocoa settled up 35 pounds, or 1.7 per cent, at 2,137 pounds a tonne, the highest since late-September.

Technical buying came into the market after the contract reversed higher on Friday while the weak sterling also supported the market, traders said.

New York September cocoa closed up $53, or 1.7 per cent, at $3,198 a tonne after touching $3,203, the highest level since October 1.

Technical buying came in after Friday’s outside reversal up, when the contract opened below the prior session’s low and closed above the previous high, traders said.

–Reuters

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