White sugar futures also slipped in London trading, while raw sugar in New York clawed back early losses to close a touch higher. "What's happening in softs isn't peculiar if you compare it to the broader agricultural markets, which are all taking a hit as the year-end approaches," said Mike McDougall, analyst at Newedge in New York.
Cocoa futures on London's Liffe sank to near seven-month lows, breaking significant support levels on historical price charts, after downward pressure from technical charts combined with forward selling from producers in West Africa. Liffe's most actively traded second month futures contract for cocoa, May, closed down 12 pounds at 1,480 pounds per tonne after sinking earlier to 1,466 pounds - the lowest level for a second month since May 31.
In New York, cocoa's most active position, the front-month March, settled down $30, or 1.3 percent, at $2,328 a tonne on ICE Futures US. The contract set a bottom of $2,311 during the session, which marked a near five-month low. ICE cocoa has been having its worst stretch in six weeks, with the market falling without let-up since Monday and heading for a weekly loss of 4 percent.
In Asia, sales of cocoa butter - one of the primary ground products from cocoa beans - was at its highest ratio in three years to sales of cocoa powder, dealers said. Both cocoa butter and powder are integral to chocolate making. March raw sugar on ICE finished up 0.2 cents at 19.25 cents a lb, after a session bottom of 18.81. Last week, the contract dipped to 18.31 cents, its lowest level for a benchmark front month sugar contract since August 2010. With forecasts for the 2012/13 global surplus in raw sugar also on the rise, producers were likely to settle for even lower prices, dealers said.
In white sugar, Liffe's March contract closed down $1.60, or 0.3 percent, at $516.20 per tonne after an intraday low at $508.90. Arabica coffee on ICE continued to hover above a 2-1/2 year low set last week with plentiful supplies following a bumper crop in Brazil keeping the market on the defensive.
Arabica coffee's most active contract on ICE, March, settled down 1.95 cents, or 1.3 percent, at $1.4295 per lb. March, which until Tuesday was a second month position, fell to $1.422 a lb last week, the lowest level for a second-month arabica contract since June 2010. Liffee's robusta coffee for March rose $18, or nearly 1.0 percent, to finish at $1,887 a tonne, after falling as low as $1,870 during the session.