Arabica Coffee futures closed lower on Tuesday due to further pressure from record breaking
lows of the Brazilian Real. The most active contract for December delivery traded 22,937 lots,
reaching new lows of 115.05 and closing with a loss of 180 points at 115.45 cents per pound.
The Brazilian currency hit new lows, breaking the introduction levels from 1994 of 4.0124. The
Real traded at BRL4.05325 at 1:30 pm EST. As the market loses confidence in Brazil’s
president’s, Dilma Rousseff, ability to recoup the nation’s budget and avoid further credit cuts,
amid corruption scandals, the real continues to weaken, according to a Bloomberg report. The
real devalued further as the dollar strengthened relative to world currencies. In addition, the
entire commodity sector experienced a loss today, adding further downward pressure on
coffee. In weather related news, Colombia has begun rationing water supplies in cities with dry
weather, as they have experienced the longest drought since 1991 caused by El Niño,
according to a report by El Tiempo.