Robusta Coffee Higher; Arbitrage Trade Supportive - -- Market Talk

Robusta coffee is higher in Europe, with Liffe's March contract up 0.5% at

$1,719/tonne. Prices are finding support from tight supply of the bean from Vietnam, as well as

arbitrage trade between robusta (used in most instant blend varieties of instant coffee) and the

more expensive arabica bean, says a trader. Arabica's recent price rise is tempting traders to sell

that contract and buy robusta, he says. On a technical basis, robusta coffee is facing technical

resistance in the run-up to $1,750/tonne and support at $1,700/tonne, says Kash Kamal, a research

analyst at Sucden Financial.