Nov. 9 (Bloomberg) -- Coffee gained on concerns that world supply will tighten, and a slumping dollar boosted investor demand for some commodities as a hedge against inflation. Sugar was little changed, and cocoa dropped.

Global coffee inventories held by producing countries may be at a record low of 16 million bags after adverse weather in Brazil and Vietnam damaged crops, the International Coffee Organization said today. The dollar fell to a 15-month low against a basket of major currencies after the Group of 20 nations agreed to maintain economic stimulus efforts.

“The supply concerns, that’s definitely adding to the buying,” said Fain Shaffer, the president of Infinity Trading Corp., a commodities broker in Medford, Oregon. “The dollar is down pretty good. It’s probably a little bit of both.”

Arabica-coffee futures for December delivery rose 1.15 cents, or 0.8 percent, to $1.4005 a pound on ICE Futures U.S. in New York. The price has climbed 25 percent this year as supplies dropped from Colombia and Central America.

Colombia, the world’s third-largest producer, will harvest 8.3 million bags this year, the Colombian National Coffee Growers Federation said last week. That would mark a 28 percent drop from 2008. A bag weighs 60 kilograms, or 132 pounds.

Sugar futures for March delivery fell 0.02 cent to 22.41 cents a pound in New York. The price has surged 90 percent in 2009.

Cocoa futures for March delivery dropped $23, or 0.7 percent, to $3,214 a metric ton. The price has gained 21 percent this year.

To contact the reporter on this story: Elizabeth Campbell in New York at ecampbell14@bloomberg.net

Last Updated: November 9, 2009 15:14 EST