ICE Coffee Futures Climb on Spec
Arabica coffee futures climbed Thursday
supported by the weak US dollar and the technical outlook. The nearby contract
for May delivery closed 2.80 points higher at 138.90 cents a pound and the July
contract closed 395 points higher at 140.80 cents a pound. Short players were
forced to cover positions as the origin selling against the May position eased
and prices moved above the recent resistance levels. The US dollar declined
against major currencies following economic data showing the economy could grow
at slow pace in the near term. In Brazil, the undersecretary of finance for
agricultural sector rejected the idea of subsidies for the coffee sector.
Dealers and farmers have been waiting for several weeks’ government measures to
help the coffee sector.
London: Robusta continued to trade
around the same features as players addressed the spot month exposure with the
discount recording a slight narrowing during the morning session. Switch
interest extended further down the board with the July/ Sept trading out
towards $18 this week, before edging narrower during early trading today. No
Grading put forward today which means during the last 2 weeks the Exchange has
approved 220 lots in preparation for the updated stock report which will be
released after the close this evening. Spot month in London reflected the 2,000
Swap trades yesterday down 4,608 lots which still leave a working balance of
almost 21,000 lots which is still big. This numbers should start to fall away
quickly swinging into next week with the expected open position into delivery
period of 5,000 lots as an estimate. Taking encouragement from the intraday
rally in New York the board was able to break down the 2080 pivot in July and
move action above the better averages into the closing sequence of the market.
The move did uncover the first origin business of the week which was absorbed
quiet well. Against the flat price strength the spot month structure gave
ground easing back below the $40 discount marker. Prices must consolidate the
action to prove the break of averages into the weekend.