Robusta Coffee Futures Fall on Harvest Pressure; Cocoa Steady

Neena Rai

  Robusta coffee futures dropped in early European trading Wednesday as harvest

pressure from top grower Vietnam limited gains, while cocoa futures

consolidated after rising sharply in the previous session.

  At 1100 GMT, January robusta coffee futures fell 0.6% to $1,467 a metric ton.

Last week, the market hit its lowest level of $1,453/ton--the lowest since June

10, 2010.

  Tuesday's "weak pricing action negates any bottoming ideas seen Friday. This

market look set to make new leg lower," Sterling Smith, futures specialist at

Citi, said.

  Prices have come under pressure recently as harvesting of robusta beans gets

fully underway in the world's top producer, which some analysts say will ease

concerns about supply shortages. Along with weakness in New York's arabica

coffee market, dealers say near-term prices could trend even lower from current

levels.

  Elsewhere, March Liffe cocoa futures slipped 0.1% to GBP1,736 a ton,

consolidating after gains in the previous session. Cocoa futures jumped to a

two-week high of GBP1,740 a ton Tuesday as traders fretted that wet weather in

Indonesia, the world's third-largest producer, would crimp global supplies.

  "What people are starting to realise is that this is clearly a long-term

bullish market. The fundamentals support that too," a London-based cocoa trader

said.

  The global cocoa deficit is expected to rise to 69,000-70,000 metric tons in

the 2013-14 crop year from 52,000 tons in the previous season, Jean Marc Anga,

executive director of the International Cocoa Organization, said last month.

  European and U.S. chocolate consumption over the next five years will grow at

a maximum rate of 2% a year as more dark chocolate is consumed, which tends to

contain more cocoa than milk chocolate, Mr. Anga added.

  Sugar futures for December delivery were largely steady, slipping 0.1% to

$482.80 a ton.