* Coffee sets new highs on chart-based buying
* Fighting in top cocoa grower Ivory Coast escalates
* Sugar seen in consolidation phase
(Adds trade comment, bylines, updates prices)
By David Brough and Sarah McFarlane
LONDON, March 7 (Reuters) - Arabica coffee futures surged because of fund buying to hit a 34-year peak on Monday, with tight supplies and slow origin selling also providing support.
Cocoa futures advanced as conflict in top grower Ivory Coast escalated, while sugar was also in positive territory.
"It's presumably a large fund or managed money that has decided now is the time (to buy coffee)," said Gary Mead, analyst with VM Group in London.
ICE May arabicas were up 8.1 cents or 3 percent to $2.8090 a lb at 1606 GMT after peaking at $2.8185.
Mead said the next target was $3 per lb, which he said could be achieved "sooner than the next few months".
Robusta coffee futures on Liffe also rose, with May up $20 or 0.8 percent at $2,410 a tonne after touching $2,429, a three-year peak for the second month.
Vietnam, the world's top robusta producer, has seen domestic coffee prices repeatedly break through record levels in recent weeks.
ICE cocoa was also higher, underpinned by fears over future supplies as a leadership standoff in Ivory Coast has seen the country's security rapidly deteriorate in recent weeks.
ICE May cocoa traded up $7 or 0.2 percent, at $3,664 a tonne, below the 32-year peak hit last week of $3,775.
London May cocoa was up 5 pounds or 0.2 percent to 2,345 pounds a tonne.
VIOLENCE ESCALATES
"I suspect we're going to continue to rally on the escalation of violence in Ivory Coast," a London-based broker said.
Ivory Coast rebels have seized a third town in the west of the African country, forces loyal to disputed incumbent Laurent Gbabgo said on Monday, adding that reinforcements were on the way to try and take it back.
An export ban, sanctions against the country and a crippled banking system have severely hindered activity in Ivory Coast's cocoa industry.
"Having Ivory Coast basically shut down has caused a significant amount of short-covering," said the broker.
Sugar prices were also higher, with whites particularly firm and catching up with gains in ICE raws late on Friday after the Liffe market had shut.
"London is having to catch up with New York, which rallied equivalent to $10 after London closed," said James Kirkup, head of sugar brokerage at ABN AMRO (Markets) UK Ltd.
ICE May raw sugar was up 0.07 cent or 0.2 percent to 29.95 cents a lb.
Liffe May white sugar was up $12.20 or 1.7 percent to $747.90 per tonne.
Dealers said the sugar market was closely tracking nominations of vessels by Cargill after it received almost 1 million tonnes of raw sugar against expiry of the ICE March contract at the end of February.
"If they (Cargill) nominate ships at a speedy rate, the market would interpret that as constructive," Kirkup said.
Broker Sucden said raw sugar prices were likely to drift sideways unless fresh fundamental news moved the market.
"We expect a period of consolidation to follow between 29 and 31 cents basis May New York and between $720 and $760 basis May London," said Sucden Financial's Nick Penney.
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