Futures Market News
Supply concerns drive volatile cocoa trading session
Dec 03, 2010 03:09 PM
Cocoa futures fluctuated as conflict in the Ivory Coast raised the specter of political violence on Friday.
On Thursday, election results generated controversy in the West African country - canddiate Alasanne Ouattara was announced as the winner in a contest against sitting president Laurent Gbagbo, but Gbagbo immediately declared the result fraudulent, reported Reuters. That pushed cocoa futures to settle up 4 percent at $2,868 per metric ton on Thursday.
"Given that cocoa production is so highly concentrated in Ivory Coast, any political disruption, violence or unrest" will boost prices, Kona Haque, a Macquarie Bank analyst, told Bloomberg. "The market is primed for an uptick."
Ivory Coast's political struggles date back at least 30 years, to a violent civil war. In response to the news of his defeat in the election, Gbagbo sealed the country's borders and announced that "the air, land and sea border of the country are closed to all movement of people and goods."
On the IntercontinentalExchange, cocoa futures for March 2011 delivery rose 1.51 percent to $2,912 per metric ton; the May 2011 contract was up 1.466 percent to $2,890 per metric ton.
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