LONDON — Cocoa prices reacted Thursday to forecasts of large world surpluses by falling to their lowest levels in nearly six years, traders said.
The price of cocoa beans for May delivery fell to $1,692 a metric ton (2,200 pounds), $30 lower than overnight levels and their lowest price since mid-1982.
Traders said the market reflected the prospect of a fourth consecutive season of surpluses, with record world production forecast in the current season, which runs from October, 1987, to September, 1988.
International merchants Gill & Duffus said in a report released Thursday that, based on expected record crops in the Ivory Coast, Brazil and Malaysia, it is forecasting 1987-88 world output to hit a record 2.106 million tons--up 6% from 1986-87.
It said this "remarkable growth" in production would cause output to exceed consumption by 122,000 metric tons, despite a 3.6% rise in consumption over 1986-87.
Most Harvests Up
Such an imbalance would take accumulated inventories by the end of the present season to 713,000 tons, the highest since 1964-65, it said.
The Ivory Coast crop is estimated to be 630,000 tons, compared to 590,000 in 1986-87; Brazil's is estimated at 426,000 tons, compared to 369,000, and Malaysia's at 190,000, up from 164,000.
Gill & Duffus projected that Nigerian output will be 135,000 tons, up 55,000 tons from 1986-87 and the biggest since 1984-85. Ghana's harvest is forecast at 185,000 tons, down from 228,000 last season.
The cocoa market has been regulated by supply and demand mechanisms since Feb. 25, when intervention buying by the International Cocoa Organization was halted indefinitely because purchases had reached the maximum of 250,000 tons that is permitted by treaty.
Importing and exporting member countries failed to agree on supplementary market support schemes at a meeting here in March. The organization is not scheduled to meet again on the issue until September.