LONDON: New York cocoa rebounded sharply on Thursday after falling to a near four-year low a day earlier, with prices supported by short covering and a weaker dollar.
March New York cocoa rose 3.9 percent to $2,210 a tonne before easing back slightly to $2,203 at 1329 GMT. Prices had tumbled 3.6 percent on Wednesday to their lowest since 2013.
March London cocoa also rose 26 pounds, or 1.48 percent, to 1,777 pounds per tonne, buoyed by the lift in New York prices.
A dealer said the increase was mostly the result of short covering, after prices failed to slide even further following Thursday's open.
"It started off as what could have been a day of consolidation, it has turned, led by New York, into what looks like a short-covering, reactive element," the dealer said.
"The fact that it failed to follow through on the downside has led to a slight turnaround in fortune from where it was heading yesterday."
The demand outlook was also boosted by an 18.7 percent rise in the Malaysian cocoa grind in the fourth quarter of 2016.
The dealer said, however, that Malaysia's grind figures still have a long way to recover after tumbling from peak levels and the market is closely watching more indicative figures from Europe and North America next week.
Other dollar-denominated commodities were also supported by a weaker dollar.
March raw sugar futures rose 0.68 percent, 0.14 cent to 20.70 cents per lb, while March white sugar was up $1.7, or 0.32 percent, at $540.80.
March robusta coffee futures rose $5, or 0.23 percent, to $2,223 a tonne.
The market remained close to the prior day's 4-1/2 year high, underpinned by poor robusta crops in Brazil and Indonesia combined with a drop in production in top grower Vietnam, where the harvest is winding down.
However, total 2016/17 global coffee production is expected to remain broadly stable, with arabica potentially set for a record level due to bumper crops expected from Brazil, Colombia and Honduras, the International Coffee Organization (ICO) said in a report.
March arabica coffee futures were up 2 cents, or 1.34 percent, to $1.51 per lb.
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