NEW YORK: London cocoa futures on ICE rose to a new 46-year high on Friday, gaining 4% in the week, as lower-than-expected production in Ghana helped to tighten global supplies.
COCOA
December London cocoa settled up 73 pounds, or 2.5%, at 3,050 pounds per metric ton after touching the highest since 1977 at 3,053 pounds. The market has regularly set new 46-year highs since late June, lifted by tightening supplies as crop problems in West Africa contribute to a substantial global deficit expected in the current 2022/23 season (October/September).
Cocoa output from Ghana is expected to be around 11% lower than a 750,000 metric ton target in the current 2022/2023 season. “We forecast that the market will return to a more-or-less balanced position in 2023/24 but note that risks to this view are skewed to the downside at present in light of production risks ahead of the main West African harvests,” BMI, a unit of Fitch Solutions, said in a report.
A Reuters poll of traders and analysts issued in late August had a median forecast of a deficit of 173,000 metric tons in the 2023/24 season. December New York cocoa rose $42, or 1.2%, to $3,654 a ton.
SUGAR
October white sugar settled down $6.50, or 0.9%, at $726.80 a ton, after touching a 12-year high of $753.10 earlier this week. The sweetener is being driven by concern over dimming supply prospects in India, one of the world’s top producers. October raw sugar fell 0.37 cent, or 1.4%, at 26.31 cents per lb after hitting a more than a four-month high of 27.10. The contract gained 1.9% in the week. Citi said its commodities team “remains bullish on ICE sugar in the short-to-medium term,” due to the weather issues in Asia.
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