Robusta Falls to 6-Week Low on Record Vietnam Crop; Sugar Drops
Robusta coffee fell to the lowest in more than six weeks in London on speculation rain in Vietnam, the world’s largest producer of the variety used in espresso, will benefit the crop starting Oct. 1. Sugar declined.
Vietnam’s main coffee-growing region got 35.1 millimeters (1.4 inches) of rain from Aug. 11-20, compared with 20.4 millimeters in the same period last year, according to data recorded at 10 stations and released by the Dak Lak Meteorology and Hydrology Department. Farmers in Vietnam may reap a record crop next season, Commerzbank AG said in a report today.
“The next crop will be very, very good in Vietnam with very good quality,” Edward de Wismes, a futures broker at Aurel BGC in Paris, said by phone today. “On the technical side, robusta is clearly bearish, bearish, bearish, and we are going to be on the resistance level around $1,800 a ton.” In technical analysis, analysts study charts of trading patterns to predict prices.
Robusta coffee for November delivery slid 1.1 percent to $1,809 a metric ton by 12:10 p.m. on NYSE Liffe. Earlier the price touched $1,084 a ton, the lowest since July 8. Arabica coffee for delivery in December gained 0.3 percent at $1.1755 a pound on ICE Futures U.S. in New York.
In Indonesia, the world’s third biggest robusta producer, the rupiah fell to its lowest since April 2009, fueling speculation of more exports. A weaker local currency increases revenue from the commodity exported in U.S. dollars. The “collapse” of the currency is weighing on prices, said Carsten Fritsch, an analyst at Commerzbank in Frankfurt.
Robusta coffee stockpiles with a valid grading certificate in warehouses monitored by NYSE Liffe were 83,770 tons on Aug. 5, down from 98,250 tons two weeks earlier. The exchange will update inventory figures later today.
“Tonight’s certified change is expected to show a decent draw down, albeit perhaps not as aggressive as the previous two occasions,” BGC Partners LLC in London said in a report e-mailed today.
Cocoa for delivery in December rose 0.4 percent to 1,630 pounds ($2,538) a ton on NYSE Liffe. Cocoa for delivery in the same month advanced 0.2 percent to $2,455 a ton on ICE.
Raw sugar for delivery in October fell 0.1 percent 16.31 cents a pound in New York. White, or refined sugar for delivery in the same month decreased 0.1 percent at $483 a ton in London.
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