Coffee rises after storm hits Central America

NEW YORK — A tropical storm that battered Central America over the weekend drove the price of coffee higher Tuesday.

Guatemala and El Salvador were hit hard by a tropical storm in recent days, which could damage production or delivery of coffee.

"A lot of traders are looking at the possibility of fungus or disease affecting the crop," said Tom Mikulski, a market strategist at Lind-Waldock. However, he cautioned that it's still not clear that production would be affected.

Coffee for July delivery rose 2.3 cents, or 1.7 percent, to settle at $1.3655 a pound.

Coffee fell earlier in the month because investors expect Brazil's harvest to be plentiful, which would increase supply of the crop.

Frozen orange juice concentrate fell. Orange juice for July delivery fell 3.95 cents, or 2.8 percent, to $1.3895 a pound.

Mikulski said the fall in prices was due, at least in part, to technical trading. The price fell below a key indicator, which likely triggered more selling, he said.

Low volume might have also helped exaggerate the move, Mikulski added. Trading volume for frozen orange juice concentrate is typically low, so that can lead to big price swings.

Metal prices were mixed as copper fell following a report that showed the Chinese manufacturing sector slowed last month. China is the world's largest importer of copper.

Copper for July delivery fell 4.15 cents to close at $3.063 a pound.

Gold benefited from the latest swoon in the euro, which fell to a new four-year low of $1.2112 early Tuesday before recovering to $1.2297. Analysts are worried that a slowdown in Europe's economy will hurt a global recovery. That has sent the euro lower and investors into alternatives to the currency shared by 16 European countries, such as gold.

August gold rose $11.90 to $1,226.90 an ounce.

The dollar has also benefited from the weakening euro, which has in turn dragged down the prices of energy contracts. Commodities contracts are priced in dollars so a stronger dollar makes them more expensive and less appealing to foreign investors.

Benchmark crude for July delivery fell $1.39 to settle at $72.58 a barrel on the New York Mercantile Exchange. In other trading of July contracts, heating oil lost 3.41 cents to settle at $1.9704 a gallon. Gasoline lost 4.41 cents to close at $1.9825 a gallon. Natural gas fell 9.3 cents to settle at $4.248 per 1,000 cubic feet.

Grain and bean contracts fell.

July wheat fell 7 cents to $4.5075 a bushel, while corn fell 5 cents to settle at $3.54 a bushel. Soybeans fell 5.75 cents to $9.32 a bushel.

From: The Associated Press