Cocoa futures returned to the front foot, setting a fresh two-year high, after data showed Asian processing volumes jumping 12.1%, easing concerns raised by a weak reading from Malaysia earlier this week.
Cocoa for December hit $2,771 a tonne in New York, the highest for a spot contract since September 2011, before easing back to $2,762 a tonne as of 08:00 local time (12:00 UK time) up 0.6% on the day.
The rise followed data from the Cocoa Association of Asia showing the region's cocoa grind at 161,097 tonnes in the July-to-September period.
That represented a sharp contrast to the decline of 3.1%, to 71,150 tonnes, shown by data on Monday from Malaysia, Asia's biggest cocoa grinding nation.
Indonesia vs Malaysia
The increase in the regional figure was attributed in part to extra cocoa processors reporting to the CCA – in essence, giving an artificial boost to the data.
It also reflects raised capacity in Indonesia, where although output fell in 2012-13, estimated by Marex Spectron down 15% at 410,000 tonnes, processing capacity has been increasing.
"What we may be seeing here is Indonesia getting on the road to eclipsing Malaysia in grindings, which is perhaps what you might expect given the countries' relative standings in production," a London trader told Agrimoney.com.
Marex pegs Malaysian cocoa output in 2012-13 at 25,000 tonnes.
'Scope for disappointment'
The trader added that the reaction on markets from the Asian data might have been stronger were it not for prospect later on Thursday of statistics on the North American grind, which investors believe will show growth of some 10%, with some forecasts of more than 12%.
"That is a big figure, and leaves some scope for disappointment," the trader said.
At Phillip Futures, Joyce Liu said: "With an improving demand outlook as well as supply issues, we remain bullish on cocoa prices."
She also flagged the role of "worries that the main cocoa crop harvest in Ivory Coast could finish earlier than expected, resulting in limited supplies", in supporting futures prices.
Ivory Coast is the top producer, with 2012-13 output pegged by Marex at 1.47m tonnes.