950808

CSCE cocoa

ends higher

NEW YORK: CSCE cocoa staged its third rally in four days on Monday, ending sharply higher as commodity funds continued cover short positions, dealers said.

September cocoa climbed $21 a tonne, to $1,318, its highest settlment in six weeks. Trades were posted from $1,302 to $1,325.

December rose $22, to $1,352. Total volume was estimated at 14,921 lots.

In addition to steady book squaring by commodity funds, who until last week had carried heavy short positions, industry analysts said concerns that the market was facing a short-term supply shortfall between mid and main-crop deliveries fueled Monday's gains.

"The perception...is that there is a shortage of midcrop product," said Ann Prendergast, softs analyst with Refco Inc. "They're expressing concern that the new crop won't be on the market for another month and the old crop is almost gone."

Although Ivory Coast is widely expected to produce a record crop for 1995-96, the current year continues to show a slight deficit. In addition, traders said views Ivory Coast would be unable to match its anticipated record production in 1996-97 offered background support.-Reuter