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Cocoa ends

sharply higher

NEW YORK: CSCE cocoa futures ended sharply higher on short covering ahead of the weekend, market sources said.

The spot September contract, which went into its month-long notice period today, surged a hefty $43 a tonne, to $1,304, as nervous speculators squared short postions after zero notices were issued against the contract.

Most active December gained $25, to settle at $1,334, after ranging from $1,317 to $1,335.

December erased losses posted throughout the week on currency-linked arbritrage. Cocoa prices slumped against London at mid-week after the major central banks intervened on behalf of the U.S. dollar.

Anticipation of a non-commercial short position on today's CFTC Commitment of Traders report helped fuel today's rally, traders said.

"Cocoa has had a sizeable short position," said Steve Platt, softs analyst for Dean Witter in Chicago. "If CFTC shows it has built more, they could get more out of this rally."

An estimated 7,847 lots changed hands on the day.-Reuter