Cocoa futures edged lower on the news
that North American cocoa processing was lower than expected.
Cocoa processors in the North America
reported grinding 117,588 tonnes of beans in the last three months of 2016,
down 1.1% year-on-year, to a four-and-a-half-year low.
Cocoa grind figures are a proxy
for consumer demand for cocoa powder and butter.
European grind data earlier in
the week also missed expectations.
But processing figures in Asia,
released on Thursday, beat expectations.
March cocoa futures in New York
were down 1.4% in early deals, at $2,135 a tonne, extending the sharp losses of
the previous session.
Cocoa prices tumbled late in the
session on Thursday, despite the strong Asian grind data.
Carlos Mera, senior analyst at
Rabobank, saw the sell-off driven by a sharp down-turn in the euro, after the
European Central Bank announced that it stood ready to step up asset purchases
if inflation does not reach target levels.
"The European industry is the largest
consumer of coca," he said to Agrimoney.
"If the euro drops the purchasing
Good West African demand
Mr Mera said that prospects for
the cocoa mid-crop were good, thanks to the mild harmattan wind.
But he said that if prices remain
low it would likely spur increased demand.
"We're expecting demand to potentially
rise towards the middle [of 2017] given the low prices."