Cocoa Falls to 6-Week Low; Arabica Coffee Eases From High

Leslie Josephs

  NEW YORK--Cocoa prices fell to the lowest point in six weeks on Wednesday, after a closely watched

forecast showed global supplies would be higher than expected this year.

  The cocoa contract that expires in December fell to $3,144 a ton on the ICE Futures U.S. exchange.

It was the lowest for the most actively traded cocoa contract since July 23. December cocoa was

recently down 0.4% at $3,153 a ton.

  Cocoa production will likely outpace demand by 40,000 metric tons in the season that ends Sept.

30, the International Cocoa Organization said last week. The London-based industry group had

previously expected production to fall short by 75,000 tons. Worldwide, cocoa production will likely

reach a record 4.345 million metric tons this season, the ICCO said, up 4.4% from its previous

forecast and 10% more than last season.

  Traders are likely taking profits from bets that prices would rise, but prices are set to rebound,

said Hector Galvan, senior market strategist at RJO Futures in Chicago.

  "The news from last week on the surplus in cocoa could also be a contributing factor," he said,

referring to the sell-off. "Nonetheless, this is still a bull market and I would not be quick to

turn my back to it."

  Cocoa futures last month rose to the highest point in more than three years, amid strong demand

for chocolate. Globally, retail chocolate sales will likely hit a record 7.3 million metric tons

this year, according to market-research firm Euromonitor International.

  Arabica coffee for December was down 2.7% at $2.0370 a pound, after rising to a four-month high in

the previous session.

  Orange-juice concentrate for November was 0.5% lower at $1.4820 a pound, while October raw sugar

was 0.8% lower at 15.70 cents a pound. Cotton for December was 0.1% lower at 65.28 cents a pound.