Robusta Consolidates After Hitting 3-year Low Friday

Neena Rai

  LONDON - Robusta coffee futures consolidated in early European trading Monday,

after a sharp slide last week prompted by expectations of a bumper coffee crop

out of top producer Vietnam.

  At 1015 GMT, November robusta coffee futures traded 0.7% higher at $1,622 a

metric ton. Friday, robusta coffee futures hit their lowest level since Oct. 8,

2010, as Vietnam's harvest got underway.

  Brokers said that local Vietnamese prices for robusta were also edging

towards three-year lows of around $1.65 a kilogram on expectations that around

29 million 60-kilogram bags will be harvested in the 2013-14 crop year.

  Elsewhere, European Union wheat futures were steady ahead of the U.S.

Department of Agriculture's report on inventories.

  November Paris milling wheat futures traded 0.1% higher at EUR193.75 a ton.

  Morgan Stanley expects a "modestly bullish" report, though it noted that the

next crop report, due Oct. 11, will likely have a much larger impact on price

direction for the remainder of the year.

  "Wheat stocks may prove bullish on lower production and strong feeding," the

bank said.

  It forecasts wheat stocks 18 million bushels lower than overall consensus,

because U.S. production was slightly lower than the USDA's 2.11 billion bushel

estimate that kept U.S. wheat strong in the June-August quarter.

  Cocoa futures for December delivery slipped 0.1% to GBP1,708 a ton. Dealers

said they awaited the Commitment of Traders report due at noon, which should

indicate further insight regarding speculative interest in the market.

  December Liffe sugar futures slipped 0.1% to $478.30 a ton. Commerzbank said

sugar futures continue to come under pressure from a weak Brazilian real.

  "The currency of the world's biggest sugar producer and exporter depreciated

last week at a rate last seen in August," it said. "The market has not been

surprised, though, by Sucden analysts predicting a 1.5% drop in sugar

production in the main cultivation area Centre-South in the 2013/14 season,

especially since this seems to be a rather optimistic estimate given the

figures available so far," it said.