Coffee Gains on Speculation Supply to Tighten;Cocoa Drops
(Corrects description of Caturra Coffee Corp. in third paragraph.)
Arabica coffee rose for the third straight session, the longest rally in three weeks, on signs that supplies are tightening. Cocoa and sugar declined.
Stockpiles at warehouses monitored by ICE Futures U.S. have fallen 1.4 percent in March, after climbing for four consecutive months. Brazil’s production of arabica beans may drop 7 percent from the previous high-yielding cycle of the biennial harvest, Sao Paulo-based Archer Consulting said in a report on March 18.
“Inventories may not be replenished to sufficient levels before Brazil harvests a smaller crop,” Rodrigo Costa, the director at White Plains, New York-based Caturra Coffee Corp., a dealer, said in a telephone interview.
Arabica-coffee futures gained 0.6 percent to settle at $1.847 a pound at 2 p.m. on ICE. Still, the has price slumped 19 percent this year.
Global coffee output will be 128.5 million bags in the season that started in October, down from the previous forecast of 130.9 million bags, the London-based International Coffee Organization said on March 1. Consumption was 135 million bags in 2010 and is set to increase in 2011, the ICO said, without providing figures for last year. A bag weighs 132 pounds, or 60 kilograms.
Cocoa futures for May delivery slid 0.5 percent to $2,359 a metric ton. The main chocolate ingredient jumped 6.8 percent in the previous three sessions.
Raw-sugar futures for May delivery decreased 1.1 percent to 25.33 cents a pound in New York, paring this year’s gain to 8.7 percent.
In London futures trading, robusta coffee, cocoa and refined sugar fell on NYSE Liffe.
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