New York cocoa falls to 9-1/2 year low as ample supplies weigh

New York cocoa futures slid to their weakest in almost a decade on Thursday as the prospect of a large global surplus weighed on sentiment, while arabica coffee tumbled on weak technicals. May New York cocoa futures were down $25 or 1.32 percent at $1,872 a tonne by 1514 GMT, after earlier dipping to $1,869, its weakest since October 2007.
May London cocoa also fell 7 pounds or 0.45 percent to 1,534 pounds a tonne, its lowest since July 2013. Dealers said fundamentals were bearish, with expectations for a good mid crop in top grower Ivory Coast pressuring the market. "There's lots of people projecting reasonably heavy surpluses," said one dealer. "So the supply situation looks more than adequate."
Global cocoa production is set to climb almost 15 percent in 2016/17 leading to a surplus of 264,000 tonnes, the International Cocoa Organisation said this week. Fresh short positions on cocoa were adding pressure, with dealers noting speculators were taking advantage of technical weakness and limiting any recovery. May arabica fell 1.50 cents, or 1.04 percent, to $1.433 per lb, stumbling on a key technical resistance level.
Fundamentals were pressured by a 36 percent rise in Honduran coffee exports in February, compared to the same time last year, due to increased production. May robusta rose $10 or 0.47 percent to $2,159 per tonne. Top producer Vietnam is forecast to export between 140,000 to 160,000 tonnes of robusta in March, traders said on Thursday.
Vietnam estimated February exports at 130,000 tonnes earlier this week, up 9.2 percent from a year ago, after a sharp drop the previous month. May raw sugar eased, falling 0.03 cents or 0.15 percent to 19.44 cents a lb. Dealers said activity was dampened by uncertainty around supply in the second quarter of the year. However, a modest premium on the front month indicated the market was betting on sufficient Brazilian production, the Commonwealth Bank of Australia said in a note.
"Chatter continues to discuss a dearth of sugar in the second quarter," analyst Tobin Gorey wrote. "The market's pricing does not share that worry for now." The market saw some physical demand, with both Egypt and Iran tendering for raw sugar. May white sugar was down $0.50 or 0.09 percent at $538.90 per tonne.