Liffe May cocoa ends up 18 pounds at 2,368 pounds a tonne on Friday after earlier hitting 2,377 pounds, the highest level for the benchmark second month since July 2010. Market supported by fighting in top grower Ivory Coast, which has raised the prospect of a return to open war. Liffe May robusta coffee ends up $10 at $2,339 a tonne.
Market supported by renewed strength in arabica market although a rise in exports from Vietnam helped to cap gains. Liffe May white sugar rises $21.40 to close at $726.40 a tonne. Market remains extremely volatile in the run-up to Monday's expiry of the March raw sugar contract on ICE.
"Most of the people that we speak to are now leaving the country because it's too dangerous," a European trader said, adding the country's cocoa industry was at a standstill. "The (cocoa) trade is in a difficult position, on the one side (presidential claimant Alassane) Ouattara wants them to continue to buy from the farmers because they need the money, on the other Gbagbo says keep exporting because he needs the money," plus there's EU sanctions in place, the trader said.
The nearby premium closed at 2.78 cents a lb, widening from 2.39 cents at the close on Thursday, with the decision by Russia earlier this week to cut import tariffs seen increasing the appetite to take delivery. The market suffered its weakest two-day performance in a month on Wednesday and Thursday with the setback seen largely as a technical correction after its prolonged advance and as investors got out of their long positions.
A shortage of high quality arabica coffee from Colombia, suffering from several consecutive smaller crops, has fuelled the coffee rally and a drawdown of stocks. "The funds are very heavily long so a bit of a wash out could be on the cards but I am not sure we will see a calamitous collapse as stocks remain so low," said a London-based broker.