Cocoa Drops From Five-Month High on Signs Output in Ghana Gains

Cocoa prices fell from the highest in five months on speculation that output is climbing in Ghana, the world’s second biggest producer.

Recent rainfall in some of the main producing regions may boost the nation’s harvest, which started in September and runs until June, the two-biggest cocoa buyers in Ghana said.

“It is the reason for today’s hard break,” said Bill Frejlich, a broker at Fox Investments in Chicago. Prices may fall to $2,400 a metric ton because of the “unexpected development,” he said.

Cocoa futures for May delivery fell $6, or 0.2 percent, to $2,827 a metric ton on ICE Futures U.S. in New York. Prices fell as much as 2.1 percent in electronic trading after the settlement price was issued.

Earlier, the price climbed to $2,917, the highest for a most-active contract since Aug. 29, on speculation that an output decline in Ivory Coast, the biggest producer, may spur a wider global shortfall.

Private buyers in Ghana purchase beans from farmers on behalf of a regulatory board. A decline in December purchases had damped expectations that the harvest would reach the goal of 650,000 metric tons set by the state-run Ghana Cocoa Board.