Futures Market News
Cocoa and coffee futures seek out gains
Aug 05, 2010 02:41 PM
Coffee and cocoa futures both rose on Thursday, as traders saw inventories shrinking over the summer. On the IntercontinentalExchange in New York, cocoa futures for December delivery rose .12 percent to $3,143 per metric ton after earlier reaching as high as $3,180 per ton.
"Fundamentals for cocoa remain bullish," Kona Haque, an analyst at Macquarie Group in London, told Bloomberg News. "There’s not a lot of good-quality cocoa available at warehouse."
The ICE reported that cocoa inventories have decreased 20 percent in the past three months, hitting their lowest level since February.
In the long term, many traders are eyeing China, where consumption of chocolate has been surging in recent years. Chinese people consume an average of just 100 grams of chocolate per year, about 1 percent of the amount consumed by Europeans, according to the Economist.
That leaves a huge amount of potential for growth in the Asian chocolate market.
Coffee "C" futures for December delivery gained .264 percent to trade at $1.713 per pound. Earlier in the day, the price went as high as $1.736 per pound. On the Liffe, the September cocoa contract carries a premium of over 5 percent over the December delivery month, which indicates a shortage of readily available supplies.
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