Feb. 10 (Bloomberg) -- Robusta coffee rose to a two-month high in London on speculation roasters will have to buy beans stockpiled in Europe as farmers withhold coffee in Vietnam, the world’s largest grower of the robusta variety.
Vietnam’s coffee exports were 112,182 metric tons in January, down 48 percent from a year earlier, according to a report on Vietnam’s General Customs Department website today. Robusta coffee inventories in warehouses monitored by NYSE Liffe have been falling since July 11, according to exchange data.
“Coffee farmers are holding back 60 percent of their crop, waiting for better prices,” Lysu Paez, an analyst at Natixis SA in Paris, wrote in a report e-mailed yesterday. “This situation has been supportive for robusta prices.”
Robusta coffee for March delivery rose 2.3 percent to $1,994 a ton by the close on NYSE Liffe in London after climbing to $2,000 a ton, the highest price since Dec. 7.
Robusta coffee for March delivery became more expensive than the May contract yesterday for the first time, signaling limited supplies, according to data on Bloomberg. Beans for March delivery are $54 a ton more than May-delivered coffee.
Options traders increased bets on higher prices by 25 percent this month, NYSE Liffe data show. Investors held 7,175 contracts giving the right to buy March coffee futures at $1,950 a ton as of Feb. 8. That was up from 5,725 lots on Jan. 31, when the March contract closed at $1,836 a ton. The $1,950 strike was the most widely held call option for March, according to the data. The March options expire Feb. 15.
Inventories of robusta coffee with valid grading certificates in warehouses monitored by NYSE Liffe were 227,170 tons as of Feb. 26, down 46 percent from 417,420 tons on July 11, according to the exchange.
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