London, Oct 22 - Soft commodity prices hit multi-month lows on investor and fund selling linked to a stronger dollar on Wednesday and risked further falls with the wider commodity complex as the economic outlook dimmed.
Only London cocoa saw strong support, on a report that a serious outbreak of swollen shoot disease in western Ghana threatened to prevent the world's No. 2 cocoa grower from achieving its goal of a 1 million tonne harvest by 2010.
Dealers also referred to the threat of further blockades of cocoa beans in top grower Ivory Coast, and said a weaker pound, standing at a five-year low against the dollar, buoyed prices.
"The blockade in San Pedro (port) was cancelled, but the threats are still there," a London cocoa dealer said.
U.S. spot-month cocoa futures touched an 11-month low of $1,924 per tonne before clawing back some ground to stand at $2,010, down $27 or 1.3 percent at 1131 GMT.
London March cocoa was up 15 pounds or 1.2 percent at 1,278 pounds per tonne in moderate volume of 2,961 lots.
Buyers have defaulted on around 50,000 tonnes of cocoa beans from Indonesia after prices dropped more than 20 percent in the last two months to track declines in New York futures, traders said on Wednesday.
Cocoa arrivals at Ivory Coast's second port of San Pedro reached 13,369 tonnes from Oct. 1 to 12, according to data from the Coffee and Cocoa Bourse (BCC) obtained by Reuters on Tuesday.
Sugar futures fell on investor and fund selling and risked further falls, pushed lower by a weaker commodities complex led by oil, a strengthening dollar and softer stock markets against a gloomy global economic outlook.
"Offers this morning related to yesterday's (Tuesday's) performance, a strong dollar, and sagging markets elsewhere have placed us on the defensive," UK broker Sucden said in a daily sugar report.
The world's worst financial crisis in 80 years hammered emerging markets on Wednesday, prompting emergency central bank moves and calls for international help to curb investor flight.
London December white sugar futures dropped to a 10-month low, basis first month, of $309.00 per tonne, and later recovered some ground to stand at $312.20 per tonne, down $7.5 or 2.35 percent, in turnover of 1,370 lots at 1143 GMT.
ICE March raw sugar was down 0.22 cent or 2 percent to 11.02 cents a lb.
Indian sugar futures rose on Wednesday on expectations a dispute over cane prices may further delay crushing operations in the main producing state.
Coffee futures also fell on investor and fund liquidation linked to the stronger dollar and weaker commodities prices on continuing worries over prospects for demand.
ICE December arabicas were down 1.55 cent or 1.4 percent to $1.1270 per lb at 1147 GMT.
London January robustas were down $25 or 1.40 percent to $1,761 per tonne in modest turnover of 2,148 lots.
Indonesian coffee exporters have delayed shipments of at least 30,000 tonnes of beans to various buyers and could default on delivery after a sharp drop in London futures prices, dealers said on Wednesday.
Rains expected in the coming days over Brazil's main coffee growing areas will help the 2009/10 crop flowering, which has been good so far, private analysts Safras e Mercado said on Tuesday.