Sugar rose in New York, extending a rally to the highest price since January 1981, on renewed concern that a global-supply deficit may widen. Cocoa fell.

A sugar shortage in Pakistan has driven retail prices close to a record, and the government has asked domestic mills to discuss plans for imports. Prices at Vashi in Mumbai, India's biggest wholesale market, rose for the eighth straight session to the highest level since at least July 2005. Futures in New York climbed for the fourth day in a row.

"Demand continues to increase," said Jurgens H. Bauer, the head of Jurgens Bauer & Associates, a broker in New York. "Supply problems are anticipated to continue."

Raw-sugar futures for March delivery rose 0.3 cent, or 1.1 percent, to 28.71 cents a pound at 9:59 a.m. on ICE Futures U.S. in New York. Earlier, the most-active contract reached 28.95 cents, the highest level since Jan. 27, 1981. The price gained 5.4 percent in the previous three days.

"The violence with which the market is moving" may push prices to 32 cents in a few days, Bauer said.

Futures more than doubled last year as adverse weather hampered cane harvests in Brazil and India, the world's leading producers. India is the biggest user. Pakistan is Asia's third-largest consumer behind China.

Cocoa futures for March delivery fell $20, or 0.6 percent, to $3,272 a metric ton in New York. Earlier, the price gained as much as 0.3 percent. Before today, the commodity advanced 28 percent in the past 12 months.

Eoin Treacy's view If one looks at enough back history, we see that sugar experienced two massive bull runs in the 1970s. Both of these were due to crop disruptions which created the conditions for the subsequent falls as higher prices encouraged farmers to increase production. This pattern is common to all soft commodities and today's high prices will result in increased supply following the next growing season, provided the adverse weather in India and Brazil seen this year is not repeated.

Sugar experienced an impressive advance in 2005 and 2006 as demand for ethanol increased and subsequently pulled back as supply responded. It found support at 10¢ and sustained the 10-year progression of incremental higher lows. It successfully broke upwards from the 28-year base in April and consolidated above 20¢ until mid-December, when it reaffirmed the uptrend. In the short-term, sugar is temporarily overextended following a surge to new highs, and tails on Tuesday and today suggest a possible near-term consolidation. However, a sustained move back below 24¢ would be needed to begin to question the integrity of the overall move.

Cocoa was an early leader in the soft commodity complex, but has paused of late. The commodity broke upwards from a lengthy range in early 2008 and rallied to more than $3000 before consolidating above $2000. It successfully broke above $3000 in September 2009 and rallied to $3500. This advance was at least checked by a weekly key reversal in mid December and a sustained move to new highs is now needed to reaffirm the overall uptrend.