Investors Cut Bearish Robusta Coffee Bets on Vietnamese Exports

Money managers cut bearish bets on robusta coffee in London by 21 percent in the latest week at a time of slow exports from leading grower Vietnam, according to data from NYSE Liffe, the derivatives arm of NYSE Euronext.

Investors were net-short, or betting on lower prices, by 8,490 futures and options in the week ended Nov. 19, the Commitments of Traders report published on the exchange’s website today showed. That compares with 10,792 contracts a week earlier. The beans used to make instant coffee and espresso rallied 4.5 percent in the period.

Coffee exports from Vietnam are forecast at 94,000 metric tons this month, data from the Ministry of Agriculture and Rural Development showed. That’s down from 122,000 tons a year earlier. Stockpiles in warehouses monitored by Liffe fell 8 percent in the two weeks to Nov. 11 to 48,770 tons, bourse data showed. That’s lower than the 52,000 tons predicted by traders in August in a Bloomberg survey for the end of the year. Prices gained 4.3 percent last week, the most in seven weeks.

“Prices rallied last week on speculative short covering, low certified stockpiles, with expectations of further inventory draw-downs, given weight by the lack of coffee coming out of Vietnam,” Toby Donovan, a broker at BGC Partners LLC in London, said by e-mail today.

Robusta coffee supplies will be 2.4 million bags bigger than demand in the 2013-14 season started Oct. 1 in most countries, estimates Macquarie Group Ltd. (MQG), Australia’s biggest investment bank. That compares with a surplus of 6.4 million bags for the arabica variety, favored for specialty drinks such as those made by Starbucks Corp., the bank said. A bag weighs 60 kilograms, or 132 pounds.

Cocoa Record

In cocoa, money managers boosted bullish bets to a record, exchange data compiled by Bloomberg showed. The net-long position was 68,949 futures and options as of Nov. 19, up from 64,676 contracts a week earlier. The beans used to make chocolate advanced 5.1 percent in the period.

Investors trimmed bets on higher white, or refined, sugar prices to 8,338 futures and options, the data showed. That compares with 8,805 contracts a week earlier. The sweetener slid 1.2 percent in the period.

In feed wheat, money managers were net-short by 159 contracts, unchanged from a week earlier. The grain was unchanged in the period.

To contact the reporter on this story: Isis Almeida in London at ialmeida3@bloomberg.net

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