Liffe Coffee May Rise Above $2,400/Ton
On Winter Demand-MacquarieDJLondon robusta coffee futures will likely rebound toover $2,400 a metric ton in the fourth quarter as roasters are expected toaccelerate purchases to meet upcoming demand during the winter season, saidMacquarie Research. Robusta coffee futures on the London International Financial Futures Exchangeended at $2,280/ton Friday, the benchmark's highest close since July 18, asLiffe inventories fell for the second consecutive week. As coffee availability from key producing countries becomes increasinglytight, roasters are also likely to continue drawing certified stocks held inthe NYSE Liffe nominated warehouses, a move which will also support prices, thebank said in a note recently. Despite a large crop of over 18.5 million 60-kilogram bags this year in toprobusta supplier Vietnam, virtually all of this has been sold, and the countryhas very little stocks to see them through to the 2011-12 harvest due November,it said. Up to 670,000 bags of contracted exports faced delays last week because ofdwindling stocks and there are fears of washouts or shipment cancellations, thebank said, citing estimates by some trading executives. Robusta supplies are also tight in Indonesia, another major Asian producer,it said. Coffee output in Indonesia will likely slump 30% to about 490,000 metrictons this year as excessive rains damaged the crop, Indonesian Coffee ExportersAssociation Executive Secretary Rachim Kartabrata said in a recent interview. Still, Macquarie predicts that prices will ease once the Vietnam harvestgains momentum towards the end of the year. By the middle of 2012, weakness from the arabica market will likely addfurther downward pressure as top producer Brazil harvests its bumper crop, itsaid.
