Cocoa prices fell to a 2-1/2 month low on Thursday as forces loyal to Alassane Ouattara in Ivory Coast advanced indicating exports possibly resuming from the world's top grower. Arabica coffee futures were slightly lower but still underpinned by tight supplies, and sugar also registered modest losses as the outlook for Brazil's harvest improved.
New York's May cocoa futures fell $35 to close at $2,952 per tonne. The market ended the first quarter down 2.7 percent as players unwound long positions after a 32-year high above $3,800 was hit in early March. James Cordier, an analyst for brokers optionsellers.com, said the market is breaking down the closer Ouattara's forces are to ousting his rival, Laurent Gbagbo, who has refused to step down from the presidency after a November election that UN-certified results showed he lost.
Investors who jumped into the cocoa rally are "being forced to liquidate" their positions, Cordier said. Prices have fallen about 8 percent since Ouattara's forces began to seize towns in the western cocoa belt this week. Arabica coffee prices were slightly lower with the market looking to consolidate. A prolonged climb to a 34-year peak earlier this month has been followed by a significant setback.
New York's May arabica coffee futures fell 0.65 cent to finish at $2.6415 per lb. On the quarter, arabicas gained 9.83 percent. The May raw sugar futures shed 0.10 cent to close at 27.11 cents per lb. On the quarter, the raw sugar market is down 15.6 percent.
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