Robusta coffee falls to 1-week low on Vietnam sales; sugar drops

TN News

Email Print

Robusta coffee fell to a one-week low on signs of more supplies from Vietnam, the world's biggest producer, and Indonesia, the third largest. Sugar also declined.

Buyers of coffee from Vietnam are paying a lower premium as farmers boosted sales because of gains in futures prices, Volcafe, the coffee unit of trader ED&F Man Holdings Ltd., said in a report e-mailed on May 17. Weather may help dry beans in Indonesia, it said. Arabica coffee prices have dropped 5.2 percent this year while robusta gained 5.2 percent.

"Weak arabicas and ideas that producer selling in Vietnam would improve weighed on values," Sterling Smith, a futures specialist a Citigroup Inc. in Chicago, said in a report e-mailed on May 17. "Indonesian weather will bring a mix of scattered showers and sunshine, but overall it should be drier and this will be beneficial to the harvest and movement of coffee, which should allow the robusta market to ease further."

Robusta coffee futures for July delivery fell 0.5 percent to $2,027 a ton by 9:46 a.m. on NYSE Liffe in London. Prices earlier today dropped to as low as $2,025 a ton, the lowest since May 13. Arabica coffee futures for July delivery retreated 0.3 percent to $1.365 a pound on ICE Futures U.S. in New York.

A lack of sun was hindering bean drying and delaying coffee deliveries from Vietnam farms, according to Nedcoffee BV in Amsterdam.

Vietnamese coffee for shipment in June and July were last week at a premium of $100 a ton to the NYSE Liffe price, down from $110 a week earlier, Volcafe said. Farmers will probably sell more if local prices rise to 45,000 dong ($2.14) to 46,000 dong a kilogram (2.2 pounds), it said. Vietnamese coffee was trading at 42,800 dong a kilogram on May 17, data from the Daklak Trade & Tourism Center on Bloomberg showed.

European stockpiles

Robusta coffee stockpiles with a valid grading certificate in warehouses monitored by NYSE Liffe were 127,270 tons as of May 13, up from 126,100 tons two weeks earlier, according to data on the exchange's website. Traders expected inventory data to be unchanged to a "small" drawdown, brokerage ABN Amro Markets (U.K.) Ltd. said in a report e-mailed today.

White, or refined, sugar for delivery in August fell 0.2 percent to $476.70 a ton on NYSE Liffe. Raw sugar for delivery in July rose 0.2 percent to 16.93 cents a pound on ICE.

Cocoa for delivery in July dropped 0.2 to 1,546 pounds ($2,349) a ton in London. Cocoa for July delivery gained 0.1 percent to $2,302 a ton in New York.

More Business News