UPDATE 1-Liffe to consult with customers on cocoa market

* Liffe meets with authors of complaint letter

* Fears remain of supply crunch in September

(Adds details, background)

By Sarah McFarlane

LONDON, July 27 (Reuters) - NYSE Liffe (NYX.N) said on Tuesday it would consult with customers and its regulator on further potential changes to its cocoa market following a meeting on Tuesday with some customers.

"Today NYSE Liffe met a number of its cocoa customers and listened to their views regarding the cocoa futures market," the exchange said in a statement.

"NYSE Liffe will take these views into consideration and consult further with its broader customer base and its regulator before determining whether any further changes are required to the market's operation or procedures."

Liffe met on Tuesday with a delegation representing a group of 16 European cocoa industry participants who sent a letter to Liffe on July 2 saying the extent of speculation on the London cocoa market could drive them towards using the rival U.S.-based Intercontinental Exchange (ICE.N) and urging more transparency in London cocoa futures <0#LCC:>.[ID:nSGE66404T] [ID:nLDE6641C8]

On July 7, Liffe announced plans to introduce a commitment of traders report detailing positions held on London's white sugar, cocoa and robusta coffee markets. [ID:nLDE66615P]

Traders said the report would improve transparency in the market.

Some of those who signed the letter of complaint to Liffe said they would use the meeting on Tuesday to ask the exchange to introduce position limits, despite an earlier consultation by Liffe which found many of its participants were against this.

Nearly all the physical stocks of cocoa that back futures trading of the commodity in London were delivered when the July contract expired, fuelling fears of a September supply crunch.

The delivery of 240,100 tonnes of cocoa on July's expiry was the largest delivery in nearly 14 years and represented almost all the physical stocks registered with the Liffe exchange, fuelling fears of a supply crunch for the September contract.

British commodities firm Armajaro was reported by UK newspapers to be the main receiver of the 240,100 tonnes of cocoa. Armajaro declined to comment. [ID:nLDE66H06M] (Reporting by Sarah McFarlane; editing by James Jukwey)