Singapore, Feb 1 - Cocoa grinders in Southeast Asia are keen to sell more ingredients for chocolate as Valentine's Day draws near but buyers are hard to find, keeping a lid on butter ratios, dealers said on Thursday.
On the bean side, the mid-crop harvest has ended in Indonesia's main growing island of Sulawesi but there are still shipments to traditional buyers such as the United States and Brazil.
Butter, a key ingredient for making chocolate, was offered at a ratio of between 2.32 and 2.35 times London futures for nearby shipments, unchanged from a month ago.
But some grinders also quoted ratios at 2.45 to compensate for a declining powder price.
When processing beans, grinders get butter and cake, which is later pressed into powder and used for coating in chocolate-making, beverages and ice-cream.
"Everybody is keen to dump their powder. I can only hope we can sell butter above 2.40 but things have been very slow," said a grinder in Malaysia, which is Asia's largest grinder.
"I think the price range for powder is between $800 and $850 on an FOB basis. The price is even lower in Indonesia. It's very hard to survive," he said.
High-quality powder was offered as high as $1,100 a tonne in Malaysia last month, but dealers said some desperate grinders had cut down the price to as low as $700 a tonne to lure buyers and ease stocks.
Powder was quoted at $700 a tonne in Indonesia, Asia's second-largest grinder, compared with around $900 last month.
"I'd be willing to sell powder at lower prices but only if butter ratios go up. The thing is that butter business has been slow in the past eight months," said the grinder in Malaysia.
Butter prices are determined by multiplying the ratio with related contracts in London, where the May contract ended one pound higher at 907 pounds a tonne on Wednesday, with persistent dry weather in West Africa underpinning prices.
"There was interest for nearby shipment in December and early January but things have been quiet since. It looks like chocolate makers have bought whatever they need," said a dealer in Singapore, referring to Valentine's Day and Easter demand.
"Of course, sellers are still looking at those high prices at 2.40 and above but we understand that there are not many deals being done at the moment," he said.
Back in Sulawesi, exporters relied on old stocks to meet demand from overseas buyers as they waited for the next harvest to start in April.
Indonesia, the world's third-largest cocoa producer, sells beans to grinders in Malaysia, Singapore, the United States and Brazil.
Two ships are scheduled to leave Makassar soon with 7,000 tonnes of beans to Brazil and 5,000 tonnes to the Unites States, said dealers.
"Supplies have dried up. We're waiting for the main crop," said a dealer in Makassar, the provincial capital of South Sulawesi.