Coffee Prices Lower
ICE Futures U.S. arabica coffee finished lower and near the session low Tuesday, pressured by weaker outside markets that included lower crude oil prices and lower U.S. stock indexes, along with a firmer value of the U.S. dollar versus the other major currencies.
May arabica coffee futures settled down 95 points at $1.1655 a pound. The July contract settled down 95 points at $1.1855 a pound.
“There’s not a lot going on,” said a New York broker. “Volume is very low and origins are out of the market.” He added that “technicals are looking weak.”
The broker said he wouldn’t be surprised to see nearby coffee futures prices drop another couple hundred points in the near term. However, he added that he’s longer-term bullish the coffee market.
Look for the outside markets to continue to be a major influence on the coffee futures market, said an analyst.
Liffe robusta coffee futures traded near unchanged in subdued activity overnight. Weakness in coffee prices in February was due to demand concerns and general agricultural commodities weakness, said Goldman Sachs.
“We maintain that price risks are skewed to the upside as yield prospects deteriorate in Colombia and India, the Brazilian crop cycles through its reduced output phase and global demand proves resilient beyond market expectations,” said the firm.
In other news, coffee exports in February in the current 2008-09 crop cycle from Colombia, Mexico, Peru, the Dominican Republic and Central America were down 4.5% to 2,633,949 bags of 60 kilograms each, Guatemala’s National Coffee Association, or Anacafe, said Tuesday. This compares to exports of 2,758,209 bags in February last year, during the 2007-08 cycle from the group, which includes the five Central American countries: Guatemala, Costa Rica, Honduras, El Salvador and Nicaragua, Anacafe said in its last monthly report for the new harvest year.
Meantime, Vietnam’s coffee exports in March may rise 34% on the year in terms of volume, according to estimates issued Tuesday by the General Statistics Office. The value of the shipments may fall 12.8%, the data showed. The GSO said March coffee exports are expected to total 130,000 metric tons, or 2.17 million 60-kilogram bags, valued at $190 million. In March 2008, Vietnam exported 97,000 tons valued at $218 million.
ICE coffee volume was estimated at 9,422 lots, according to exchange data. In options, approximately 4,075 calls and 2,100 puts traded.
ICE coffee warehouse stocks decreased by 2,721 60-kilogram bags Monday, to total 4.034 million bags, according to exchange data.
ICE coffee open interest increased by 733 lots Friday to total 139,520 lots, according to exchange data.
ICE Change RangeMay 1.1655 -95 pts 1.1625-1.1790Jly 1.1855 +95 pts 1.1820-1.1990
Source: http://www.marketwatch.com/news/story/dj-ice-coffee-review-lower/story.aspx?guid={81CEBE93-7639-48EE-BB20-2D8C5883490A}&dist=msr_4
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