Coffee Futures Drop to Lowest Since 2009 on Ample Supply
Coffee futures fell to the lowest since September 2009 on increasing supplies from Brazil, the world’s largest producer. Sugar and cocoa gained.
Growers in Brazil will harvest a record 57.8 million bags of coffee in the season starting Oct. 1, and global supplies will outpace demand for the second straight year, according to Volcafe, the Winterthur, Switzerland-based unit of commodity trader ED&F Man Holdings Ltd. Futures headed for the biggest monthly drop since October.
“The market is under pressure because we see ample supply from Brazil,” Hernando de la Roche, a senior vice president at INTL FCStone in Miami, said in a telephone interview. “This crop is a huge crop.”
Arabica coffee for July delivery declined 1 percent to $1.263 a pound at 12:22 p.m. on ICE Futures U.S. in New York. Earlier, the price touched $1.252, the lowest for a most-active contract since Sept. 14, 2009.
Through yesterday, the price tumbled 23 percent in the past 12 months, the most among 24 raw materials in the Standard & Poor’s GSCI Spot Index.
A bag weighs 132 pounds (60 kilograms). Brazil is also the top exporter.
Raw-sugar futures for July delivery rose 0.5 percent to 16.75 cents a pound.
Cocoa futures for July delivery rose less than 0.1 percent to settle at $2,211 a metric ton at 11:58 a.m.
To contact the reporter on this story: Elizabeth Campbell in Chicago at ecampbell14
To contact the editor responsible for this story: Steve Stroth at sstroth.