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terça-feira, 6 de setembro de 2011

Coffee Peaking as Cargoes Carrying Brazilian Beans Surge

Bloomberg -
: Freight Markets The rally that drove arabica coffee prices up 50 percent in a year may be ending as record production in Brazil, the highest output in a decade in Central America and a rebound in Colombia’s crop boost exports. Brazil, the world’s largest grower, may produce up to 3.78 million metric tons (63 million bags) of beans next year, a jump of as much as 37 percent, London-based broker Marex Spectron Group says. Central America will reap the most since the 1999- 2000 season, the U.S. government forecasts. While that won’t be enough to boost shipping rates, it may send coffee down 13 percent to $2.50 a pound in the first quarter and $2.20 in the second, a Bloomberg survey of seven analysts and traders showed. Arabica, the most-consumed variety, more than doubled since June 2010 as rain curbed output in Colombia, the second-biggest producer, and Brazilian stockpiles fell to their third-smallest in a half-century, USDA data show. ABN Amro Bank NV and VM Group forecast a surplus for the season that begins Oct. 1. Futures are 8.8 percent below the 14-year high reached in May, and Kraft Foods Inc. and J.M. Smucker Co. have cut prices. “I’m saying to the producers that now is the moment to sell,” said Ricardo Villanueva, the president of Guatemala’s National Coffee Association, known as Anacafe. “We could have these prices until March or April, but no more than that.” Arabica prices rose 20 percent last month on the ICE Futures U.S. exchange, the most since June 2010, on speculation that frost in Brazil will limit next year’s crop. Coffee was the biggest gainer in the Standard & Poor’s GSCI Index of 24 commodities, which declined 1.7 percent. Instant Coffee Global production of arabica beans will outpace demand by 690,000 60-kilogram (132-pound) bags in the next season, ABN Amro and VM Group predict. The surplus in robusta, the second most-consumed variety, will be 3.87 million bags, they estimate. Smucker, which owns the Folgers brand, reduced prices for the majority of its coffee products sold in U.S. by an average 6 percent on Aug. 16. The Orrville, Ohio-based company raised charges 10 percent in February, said Vincent Byrd, the director and president of U.S. retail coffee. Kraft cut prices on some products 6 percent, Bridget MacConnell, a spokeswoman for the Northfield, Illinois-based company, said Aug. 23. It increased Maxwell House and Yuban ground coffees by about 22 percent in March, she said. Starbucks Hedges Starbucks Corp. (SBUX), the world’s largest coffee-shop operator, said July 28 that higher bean costs would trim earnings per share by 21 cents in its fiscal year ending in September 2012, from a year earlier. The Seattle-based company will report a 20 percent gain in per-share profits to $1.82 in the period, the mean of 11 analysts’ estimates compiled by Bloomberg show. Starbucks bought most of the coffee it needs for fiscal 2012 as prices retreated from a 14-year high, Troy Alstead, chief financial officer, said in a conference call on July 28. Coffee is usually shipped to international markets in burlap bags loaded into steel boxes, each capable of carrying more than 19 metric tons. Global exports reached about 93.4 million bags in the 2009-2010 season, according to the London- based International Coffee Organization. That amount would fill about 290,000 containers, data compiled by Bloomberg show, or about 0.05 percent of the 546 million containers that Clarkson Plc, the world’s largest shipbroker, estimates will move from ports this year. The broker’s projected 8.5 percent expansion in the global container trade in 2011 hasn’t been enough to bolster rates that dropped to zero on some routes because of a glut of ships. Container Vessels The global fleet of container vessels expanded 17 percent to 4,768 since the end of 2007 and orders at shipyards are equal to 27 percent of existing capacity, data from Redhill, England- based IHS Fairplay show. Rates excluding fuel surcharges on shipping lanes from Asia to Europe, the second-busiest after trade from Asia to the U.S. West Coast, were zero in July and little changed in August, the longest stretch in the industry’s half-century history, according to Morgan Stanley. The cost including surcharges for moving a box from China to Europe fell to $833 from $1,903 in July last year, according to data from London-based Clarkson. About 90 percent of world trade is transported by sea, the Round Table of Shipping Associations estimates. Containers are also used to carry everything from televisions to washing machines to meat. Shipping Glut Other types of shipping are also suffering from a glut. Supertankers hauling oil from Saudi Arabia to Japan, the benchmark route, were last at minus $1,789 a day, data from the London-based Baltic Exchange show. Owners are effectively paying clients to hire ships because it covers some of their fuel costs as they move carriers to more profitable regions. Returns reached $177,000 in July 2008. Rates for capesizes, mostly carrying coal and iron ore, were last at $24,199 a day, compared with $234,000 in 2008, according to the Baltic Exchange, which publishes daily rates for more than 50 maritime routes. While shipping lines are contending with a glut, the coffee industry is struggling to meet demand. Even at the $2.20 a pound anticipated in the Bloomberg survey, arabica would still be almost twice as costly as the 10-year average of $1.15. Speculators are getting more bullish, increasing their net- long positions, or bets on higher prices, for a third week to 19,651 futures and options by Aug. 30, U.S. Commodity Futures Trading Commission data show. That’s 47 percent below the peak reached at the end of April, before reaching the 14-year high of $3.089 a pound. First Quarter “There have been a lot of investors moving into the coffee market over the past year and there is little chance of a move toward $2 to $2.30 until the end of the first quarter,” said Bryan Stockley, the managing director of Coburg Coffee Co., a London-based roaster. “The performance of the price in the first quarter next year should be more fundamentally based.” Options traders are split on the direction of prices. The most widely held option gives holders the right to buy arabica at $3 by November, while the second-biggest contract is for $2.50 by the same date, ICE Futures U.S. data show. Arabica for December delivery dropped 2.2 percent to $2.818 a pound at 8:36 a.m. London time on ICE. The divergence is being caused in part by two months of drier-than-average weather in Brazil, ahead of the flowering phase for the next crop. Too little rain may cause blossoms to fall before the buds have formed, while some rain followed by another drought would increase that risk, Commerzbank AG said in a report Sept. 1. Bags of Arabica Marex expects Brazil to reap 60 million to 63 million bags of coffee production next year, the high-yielding half of its two-year cycle, from 46 million to 48 million bags this year. The first beans will be picked at the end of May, with the harvest officially starting in July. The country’s arabica exports will probably increase by about 2 million bags to 29 million bags in the 2012 calendar year, according to Guilherme Braga, the head of CeCafe, the Brazilian exporters’ council. Shipments from Colombia, the second-biggest, may rise to 8.5 million bags from 7.8 million, according to Luis Rangel, a vice president at ICAP Futures LLC in Jersey City, New Jersey. The nation will produce 10.5 million bags, from an almost four- decade low of 8.1 million bags in 2009-10, USDA forecasts show. Honduras, which the USDA estimates overtook Guatemala as Central America’s largest grower this season, will probably expand output 2.5 percent to 4.1 million bags in the next season, for a third consecutive gain, USDA data show. Output in Guatemala will probably rise 3 percent to 4 percent to 3.6 million bags, said Villanueva of Anacafe. Regional Exports Combined Central American production will increase more than 1 percent to 13.4 million bags, the most since the 1999- 2000 season, the USDA estimates. The region usually exports more than 90 percent of its beans, USDA data show. “I see prices staying historically high into the first quarter,” said Kona Haque, a commodities analyst at Macquarie Group Ltd. in London. “From the second quarter on, prices should start coming down as Brazil awaits a bumper harvest and supplies improve in Colombia and Central America.”

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