:. Food Industry News


Cocoa Buoyed by Slow W. Africa Bean Arrivals

Source: Reuters
24/11/2008

London, Nov 24 - Cocoa futures rose on Monday on slow bean arrivals in West Africa, while coffee edged up with the wider commodities complex as markets digested news of a U.S. government rescue deal for banking giant Citigroup Inc.

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Raw sugar futures rose, supported by investment fund buying as the markets absorbed news that the U.S. government agreed to rescue Citigroup <C.N with $20 billion of new capital.

World stocks rebounded on Monday from last week's 5-1/2 year low after the U.S. government unveiled a $300 billion-plus rescue package for Citigroup.

A steady stream of news that cocoa bean arrivals in top producing region West Africa were sharply down, provided firm support to the market, dealers said.

"The numbers are way short of what you would expect for the main crop cocoa season," one London cocoa dealer said.

Cocoa arrivals at ports in No. 1 grower Ivory Coast totalled 201,000 tonnes from Oct. 1-Nov. 23, sharply down from 398,038 tonnes received in the same period last season, exporters estimated on Monday.

Benchmark March ICE cocoa futures were up $33, or 1.6 percent, at $2,078 per tonne at 1211 GMT.

London March cocoa was up 5 pounds or 0.4 percent to 1,423 pounds per tonne in reasonable turnover of 11,337 lots.

Dealers said that if the pound weakened after an expected UK tax stimulus announcement later on Monday, sterling-denominated London cocoa futures could receive an additional boost.

Coffee futures rose in modest volumes, supported by improved sentiment across the commodities and financial spectrum after the Citigroup rescue deal, dealers said.

January robustas were up $27 or 1.5 percent to $1,840 per tonne in slim turnover of 2,290 lots at 1214 GMT.

ICE March arabicas were up 1.4 cent or 1.3 percent to $1.1215 per lb.

Vietnam's coffee exports for November are forecast to fall 28.6 percent from a year ago to an estimated 50,000 tonnes, or 0.83 million bags, the government's statistics office said on Monday.

ICE raw sugar futures rose on investor and fund buying, underpinned by firming oil prices, with the benchmark March-March white sugar premium holding steady at around $68-69 per tonne.

Oil rose above $50 a barrel on Monday as investors eyed the prospect of a further OPEC supply cut to prop up prices that have been pressured by weakening global demand.

"We saw some fund manager buying of raws," one sugar dealer said. "The market is trying to consolidate."

ICE March raw sugar was up 0.24 cent or 2.1 percent to 11.52 cents per lb at 1216 GMT.

London March white sugar futures were up 80 cents to $322.80 per tonne in thin volume of 642 lots.

Dealers expect medium-term upside price risk due to expectations of a widening global sugar deficit.



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