Brazilian Coffee Extends Decline as Futures Tumble, Brokers Say

Coffee prices in Brazil, the world’s largest producer, extended a decline as arabica futures tumbled and touched the lowest price in 15 months yesterday, local brokers said.

The price of fine cup arabica beans is 420 reais ($245) to 450 reais for a 60-kilogram (132-pound) bag, according to Flavour Coffee. That compares with 480 reais on Feb. 3, when the price fell below 500 reais for the first time since August, the Rio de Janeiro-based broker said, and 470 reais to 480 reais on Feb. 9.

Arabica futures dropped for a seventh consecutive day yesterday, falling to as low as $1.978 a pound, the lowest price for the most active contract since Nov. 4, 2010, on expectations of a big harvest in Brazil in the season starting in July. The commodity for May delivery was little changed at $2.0145 by 8:25 a.m. today on ICE Futures U.S.

It’s a “scary movie for many people, especially for some producers,” Thiago Cazarini, a broker at Varginha, Brazil-based Cazarini Trading Co., wrote in a report yesterday. “If prices keep coming down it won’t take long for them to sell a lot of the stocks they have.”

Coffee output in Brazil will rise to a record 49 million to 52.3 million bags this year, from 43.5 million last year, the Agriculture Ministry’s crop-forecasting agency, known as Conab, estimated on Jan. 10.

The “local market followed ICE falls this week, with prices trading as low as 420 reais, a quite impressive drop,” Flavour Coffee said in a report e-mailed yesterday.

To contact the reporter on this story: Isis Almeida in London at

To contact the editor responsible for this story: Claudia Carpenter at

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.