Coffee Rises as European Stockpiles Decline Again

Coffee rose in London, on course for the biggest weekly climb since June 2010, as European stockpiles tracked by the NYSE Liffe exchange fell for a second time. Sugar slid.

Robusta coffee inventories with valid grading certificates came to 404,470 metric tons as of Aug. 8, down 1.4 percent from two weeks earlier, figures on NYSE Liffe’s website showed yesterday. Stocks also fell in the two weeks to July 25, the data showed. Coffee gained today even as the S&P GSCI Index of raw materials retreated for a third day this week.

“I expect robusta to keep firming into Q4, particularly as roasters return from holidays to start preparing for the winter peak coffee demand,” Kona Haque, an analyst at Macquarie Group Ltd. in London, said by e-mail today. “Origin supplies will still be scant at that point, and roasters may have to turn to the exchange’s stocks in order to get their coffee.”

Robusta coffee for November delivery climbed $67, or 3 percent, to $2,287 a ton by 12:17 p.m. on NYSE Liffe in London. Prices are up 9.2 percent this week and today advanced for a fourth day, the longest streak since June. Arabica coffee for December delivery rose 0.85 cent, or 0.3 percent, to $2.449 a pound on ICE Futures U.S. in New York.

Robusta stockpiles in Europe are set to drop until supplies become available from the new season in Vietnam, the world’s largest producer of the variety, Ana Vohringer Wilks, head of coffee at Armajaro Trading Ltd., said in an interview Aug. 8. Vietnam’s harvest usually starts in October.

Colombian Production

Colombia, the world’s second-largest producer of arabica beans, trimmed its production forecast for the year by about 5.6 percent to 9 million bags, said Colombia’s National Coffee Growers Federation Chief Executive Officer Luis Munoz.

White, or refined, sugar for October delivery slid $12.70, or 1.7 percent, to $737 a ton in London. Raw sugar for October delivery fell 0.14 cent, or 0.5 percent, to 27.94 cents a pound in New York.

Raw sugar may advance next week after Brazil reduced its cane-crop forecast for the second time this year to 510.2 million tons. The country is the world’s biggest sugar producer. Five of seven traders, analysts and brokers surveyed by Bloomberg News said raw sugar in New York would rise. In London, four respondents said refined sugar would gain,

Cocoa for December delivery rose 5 pounds, or 0.3 percent, to 1,852 pounds ($3,012) a ton on NYSE Liffe. Cocoa for December delivery advanced $11, or 0.4 percent, to $2,897 a ton on ICE.

Deliveries to ports in Ivory Coast, the world’s biggest cocoa producer, climbed 25 percent to 1.374 million tons in the season to Aug. 7, a document obtained from the industry’s regulator showed.

From: businessweek.com