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Arabica coffee futures fell on Thursday as a weaker currency in top grower Brazil pushed the contracts to two-months lows, sparking technical selling, while raw sugar futures also fell. March arabica coffee fell 1.3 percent to 97.60 cents per pound at 1409 GMT, after dipping to 97.55, its lowest since Dec. 18.

The Brazilian real hit its lowest in three weeks versus the US dollar. A weaker real can encourage producer selling of dollar-denominated commodities like coffee and sugar.

"We're still in a bear market," said a London-based broker, pointing to high stocks, oversupply in both arabica and robusta, and increased technical selling.

Traders in Vietnam are struggling to buy coffee beans from local farmers who are reluctant to sell at low prices, meaning exports could decline as early as March or April.

Arabica coffee prices will rise by the end of 2019 as the market swings into deficit, a Reuters poll showed.

May robusta coffee fell 0.5 percent to $1,526 per tonne.

March raw sugar fell 0.9 percent to 12.64 cents per lb, nearing Monday's lows.

The March contract's premium over May was at 0.18 cents, having hit a high of 0.22 cents on Tuesday and Wednesday, indicating tightness in nearby supply.

May white sugar dipped 0.2 percent at $333.80 a tonne, having hit $346.400, its highest since late January.

A total of 78,300 tonnes of mostly Indian white sugar has been tendered against the March contract on ICE Futures Europe, exchange data showed.

May New York cocoa fell 0.9 percent to $2,267 per tonne, having touched a two-week high in the previous session.

May London cocoa fell 0.2 percent to 1,710 pounds per tonne.

Underpinning cocoa prices in London, sterling hit a one-month low on reports the British government could lose a key Brexit parliamentary vote later this session.

Copyright Reuters, 2019


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