SOFTS-NY cocoa futures extend longest rally since March 2016

(Recasts throughout, adds closing prices, comment, milestones; NEW YORK dateline)

NEW YORK/LONDON, Feb 2 (Reuters) - Cocoa on ICE Futures U.S. rose on Friday to cap a sixth straight weekly rise, extending its longest such rally in about two years as speculators covered short positions.

Sugar futures also rose, while arabica fell to a two-week low.


* March London cocoa settled up 47 pounds, or 3.34 percent, at 1,455 pounds per tonne and rose to 1,457 pounds, the front-month's highest since November. That marked its biggest one-day rally since July.

* March New York cocoa settled up $42, or 2.08 percent, at $2,059 per tonne after hitting $2,063, the highest since November.

* Dealers said the market had been supported by technically-driven buying and a diminished crop outlook in Ghana following dry weather, spurring short-covering.

* "We took a lot of shorts out of the market last week, and more came out this week," said a U.S. trader.

* Overall supplies, however, remain ample.

* "Despite strong grinding numbers, especially in Europe, a record 2016/17 West African season and a strong start to the ongoing 2017/18 season will keep markets well-supplied and prevent a significant move higher," BMI Research said in a report on Friday.


* March raw sugar settled up 0.26 cent, or 1.94 percent, at 13.63 cents per lb, rising for a second session since finishing January down nearly 13 percent.

* A short-covering rally has helped prices recover from mid-January's 3-1/2 month low of 13.02 cents, but producer selling was likely to limit the scope for any rebound in prices, dealers said.

* The world sugar market is poised for a larger surplus in the current 2017/18 year than previously expected, likely followed by another year of oversupply, a Reuters survey showed.

* March white sugar settled up $2.50, or 0.7 percent, at $358.10 per tonne.

* India's 2017/18 sugar output is likely to jump 33 percent from a year ago to 27 million tonnes, giving the world's second-biggest producer enough surplus for overseas sales, ED&F Man said.

* INTL FC Stone raised its forecast for a sugar surplus, even as it said mills will divert more cane supplies to ethanol over sugar this year, versus last year.


* March arabica coffee settled down 1 cent, or 0.82 percent, at $1.204 per lb after falling as low as $1.1985.

* Honduran coffee exports grew 32 percent in January, versus the prior year.

* March robusta coffee settled down $5, or 0.28 percent, at $1,764 per tonne. )