Cocoa futures rose to the highest in more than two years on signs that improving demand from chocolate makers is eroding tight global bean supplies. Sugar gained, while cotton, orange juice, and coffee slid.
Cocoa-bean stockpiles at warehouses monitored by ICE Futures U.S. fell yesterday for the 38th consecutive session to the lowest since February, exchange data show. Grindings, a measure of demand, climbed in Europe, North America and Asia in the third quarter. As of Oct. 11, the price of cocoa butter, a byproduct used in chocolate bars, jumped to the highest in more the five years, according to data compiled by Bloomberg.
“The trade understands that with the positive grind numbers, demand should hold prices higher,” Hector Galvan, a senior commodities broker at RJO Futures in Chicago, said in an e-mail. “We have a need, and cocoa prices are absorbing the pace of that need.”
Cocoa for December delivery rose 1.4 percent to settle at $2,769 a metric ton at 12:01 p.m. on ICE Futures U.S. in New York, after reaching $2,780, the highest for a most-active contract since September 2011. Futures are up 24 percent this year, the most among 24 commodities tracked by the Standard & Poor’s GSCI Spot Index.
The price may test $2,800 “in the very near term,” Galvan said.
Raw-sugar futures for March delivery gained 0.2 percent to 19.45 cents a pound in New York.
Cotton futures for December delivery dropped 0.7 percent to 82.45 cents a pound on ICE, the third straight decline. Inventories at warehouses tracked by ICE have risen to the highest since July, exchange data show. Farmers in the U.S., the world’s biggest exporter, are collecting crops for the season that began Aug. 1.
“The rising inventories illustrate the typical harvest pressure on prices,” John Flanagan, the president of Flanagan Trading Co. in Fuquay-Varina, North Carolina, said by e-mail.
Orange-juice futures for January delivery slid 0.2 percent to $1.175 a pound in New York. Arabica-coffee futures for December delivery fell 0.7 percent to $1.1195 a pound.