Cocoa climbs for 3rd straight day as selling pressure eases, rainy weather hits Ivory Coast

Cocoa rises on weather worries, technical trading

NEW YORK — Cocoa prices rallied for a third day Tuesday as recent selling pressure eased and concerns grew about rainy weather that could affect crops in the Ivory Coast, a major producer.

Cocoa for July delivery is up $73, or 2.5 percent, at $3,032 per metric ton.

Analysts were mixed about what was the primary driver of higher prices that have sent cocoa up 4.2 percent over the past three days.

Spencer Patton, founder and chief investment officer for hedge fund Steel Vine Investments LLC, said rising prices were due primarily to technical trading. Prices jumped because sellers trying to drive pricers lower exited the market after prices failed to fall below about $2,900 last week, Patton said.

It “was an exhaustion of selling,” Patton said. Without as many sellers in the market, prices have rebounded, he said.

Tom Mikulski, senior market strategist at Lind-Waldock, said recent bad weather in the Ivory Coast also has investors worried about potential damage to the crops from disease. The Ivory Coast is one of the world’s largest producers of cocoa.

“The threat from black pod (disease) gives some jitters,” Mikulski said. The disease pops up in wet weather and destroys cocoa bean pods.

While cocoa jumped, most other commodities traded in a tight range throughout the day. Metals mostly edged out gains, while grains and energy contracts mostly fell.

Gold for August delivery rose 10 cents to settle at $1,240.80 an ounce. The modest gain comes a day after gold hit a record high of $1,266.50 an ounce.

July silver rebounded after falling Monday. It rose 9.3 cents to settle at $18.947 an ounce.

Copper also rose. September copper rose 5.1 cents to settle at $3.0105 a pound.

Corn and both fell, while soybeans rose.

Patton said the overwhelming volume of corn planted for this year’s harvest season has kept prices down. Corn for August delivery fell 3.25 cents to $3.61 a bushel.

Wheat dropped 1.5 cents to settle at $4.7575 a bushel, while soybeans rose 2.25 cents to $9.655 a bushel.

In energy trading, it was the last day of trading for the July crude oil contract. The August contract, where most of the trading has moved, fell 76 cents to settle at $77.85 a barrel on the New York Mercantile Exchange.

August heating oil fell 3.06 cents to $2.1307 a gallon, while Augst gasoline fell 1.17 cents to $2.1262 a gallon. Natural gas for September delivery fell 10.7 cents to $4.837 per 1,000 cubic feet.