Cocoa prices plunge on Ivory Coast fighting

AP News
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Posted: Mar 29, 2011 4:16 PM
Cocoa prices plunge on Ivory Coast fighting

Cocoa prices plunged nearly 6 percent Tuesday as Ivory Coast rebels advanced on the capital over a disputed presidential election that has ensnared the cocoa trade.

Cocoa futures lost $191 to settle at $3,057 per metric ton. The price has fallen 19 percent since hitting $3,774 per ton earlier this month.

The violent dispute revolves around which leader will control the government of the Ivory Coast, the world's largest cocoa producer.

U.N.-certified results of a Nov. 28 presidential election showed Alassane Ouattara won, but he has been unable to assume office because incumbent leader Laurent Gbagbo has refused to leave.

The rebels are backing Ouattara, who has been internationally recognized as the nation's leader. He called for an export ban on cocoa in mid-January in an effort to force his rival to step down.

Traders were selling contracts on speculation that the export ban may be lifted soon, said Spencer Patton, founder and chief investment officer for hedge fund Steel Vine Investments LLC.

"We're finally starting to see maybe a resolution to the conflict and that is everything," he said.

In other trading, wheat, corn and soybeans all rose slightly ahead of a U.S. Department of Agriculture forecast expected Thursday that should provide details about what crops farmers plan to plant this year.

The report has drawn much interest because global supplies of corn and soybeans are tight. Wheat supplies are more plentiful.

In May contracts, wheat prices rose 12 cents to settle at $7.3725 a bushel, corn gained 0.75 cent to $6.7175 a bushel and soybeans rose 13 cents to $13.615 a bushel.

Concerns about ongoing violence in the Middle East and North Africa sent oil prices slightly higher. Traders have questioned whether oil supplies from the region may be affected by anti-government clashes in Libya and other countries.

Benchmark crude for May delivery gained 81 cents to settle at $104.79 per barrel on the New York Mercantile Exchange.

In other Nymex trading, April heating oil rose 1.61 cents to settle at $3.0573 per gallon and April gasoline rose 1.6 cents to $3.0436 per gallon. Natural gas for May delivery fell 18.5 cents to settle at $4.263 per 1,000 cubic feet.

Metals mostly were lower. In May contracts, gold fell $3.70 to settle at $1,416.20, silver lost 10.1 cents to $36.987 an ounce and copper slipped 0.35 cent to $4.3465 a pound.

April platinum gave up $7.20 to settle at $1,740.60 an ounce while June palladium added $7.25 to $752.95 an ounce.

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Associated Press writers Marco Chown Oved and Rukmini Callimachi in Abidjan, Ivory Coast, contributed to this report.