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London cocoa futures extended Friday's rally to reach more than a seven-month high, as meteorological data released Monday added to market jitters over dry weather in top producer Ivory Coast.

Rains in Ivory Coast's cocoa-growing belt were below a 25-year average in most regions during the last 11 days of July, raising concern that dry weather that has persisted since early June will hamper the development of the coming main crop.

Liffe benchmark December added 29 pounds to 990 pounds a tonne, at the top of the 960-991 pound range reached Monday and the highest since a peak of 1,006 pounds on December 15.

Volume for the contract stood at 5,727 lots out of a total of 14,408.

"People are nervous but it's difficult to know if we're pre-empting a deterioration in the crop or running ahead of ourselves," an analyst said.

The market has surged more than 30 percent since early July on the back of a switch by funds to a net long position from a net short position. Thin supplies from origin sellers have put further upwards pressure on prices.

Copyright Reuters, 2004


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