Robusta coffee advanced for a third day in London on speculation investors may be buying as farmers in top producer Vietnam hold back beans and sales in third-ranking Indonesia slow with the start of Ramadan. Cocoa gained.
Money managers reduced cut their bearish bets on robusta coffee by 5.6 percent in the week ended July 2, data from the NYSE Liffe exchange showed. Vietnamese coffee was trading at 39,100 dong ($1.84) a kilogram (2.2 pounds) yesterday, a 4.5 percent increase from two weeks ago, data from the Daklak Trade & Tourism Center on Bloomberg showed. The Muslim fasting month of Ramadan this month may slow sales from Indonesia.
“Robusta prices were firm as product is difficult to source in Vietnam,” Sterling Smith, a futures specialist at Citigroup Inc. in Chicago, said in a report e-mailed yesterday. “The Ramadan holiday has also slowed movement from Indonesia.”
Robusta coffee for September delivery gained 0.6 percent to $1,871 a metric ton by 10:32 a.m. on NYSE Liffe in London. The price touched $1,882 a ton yesterday, the highest since June 5. Arabica coffee for delivery in September retreated 0.1 percent to $1.221 a pound on ICE Futures U.S. in New York.
Coffee exports from Vietnam were probably 91,000 tons in June, according to the Ministry of Agriculture and Rural Development. That is down from 141,000 tons a year earlier, the data showed. Money managers’ net-short position in robusta coffee fell to 9,128 contracts in the week ended July 2 from 9,667 lots a week earlier, NYSE Liffe data showed.
Coffee futures for September delivery became more expensive than the November contract on July 8, a market structure known as backwardation that signals limited supplies. Robusta coffee for September was at a premium of $12 a ton to the November futures, reversing a discount of $5 a ton a week ago.
Cocoa for September delivery advanced 0.5 percent to 1,533 pounds ($2,283) a ton in London, after rising 1.2 percent yesterday. Cocoa for September delivery gained 0.9 percent to $2,206 a ton on in New York. Prices rose 0.6 percent yesterday.
Growing areas of Ivory Coast and Ghana, the world’s leading cocoa producers, will get light and scattered showers this week ranging from 0.25 inch to 2 inches, MDA Weather Services in Gaithersburg, Maryland, said in a report e-mailed yesterday.
“More rain is still needed in Ghana and dryness is increasing in Ivory Coast,” MDA said.
White sugar for October delivery slid 0.2 percent to $474 a ton on NYSE Liffe. Raw sugar for delivery in October fell 0.3 percent to 16.29 cents a pound on ICE.
To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.