Brazil Coffee Weather - Feb 14

SAO PAULO AND MINAS GERAIS

SUMMARY- Mostly dry during the past 24 hours. Temperatures 85-95F (29-35C).

FORECAST-

TODAY...Mostly dry conditions. Temperatures 86-95F (30-35C).

TONIGHT...Mostly dry conditions. Temperatures 61-73F (16-23C).

TOMORROW...Mostly dry or a few light showers northeast with a few showers and

thunderstorms southwest. Temperatures 82-94F (28-34C).

OUTLOOK...Mostly dry or a few light showers northeast with a few showers and

thundershowers southwest  Sunday, mostly dry Monday and Tuesday. Temperatures

near to above normal Sunday and Monday, above normal Tuesday.

BRAZIL COFFEE PROSPECTS...

Mostly above normal temperatures and limited rainfall during the next 5 days

will deplete soil moisture and increase stress. Some production losses are

possible. Some increase in showers are expected late this week or weekend

before it turns drier again next week.

Café tem retração na ICE, mas mantém se próximo à referencial

Os contratos futuros de café arábica negociados na ICE Futures US encerraram esta quinta-feira com quedas. As perdas chegaram a ser relativamente pronunciadas ao longo do dia, entretanto, no encerramento do pregão as quedas foram apenas relativas, com o março continuando a flutuar próximo do nível de 140,00 centavos. O dia foi caracterizado por uma volatilidade mais efetiva, com o primeiro contrato tendo uma oscilação de 640 pontos. Os players continuam bastante focados na questão climática do Brasil. A possibilidade de o quadro de calor excessivo e seca no país ser cessado a partir da sexta-feira levou alguns participantes, que entraram comprando mais fortemente nos últimos dias, a realizar algumas vendas. Segundo algumas empresas de meteorologia, uma massa vinda do sul do continente deve atingir o cinturão cafeeiro nesta sexta, o que deverá garantir algumas chuvas e tornar as temperaturas ligeiramente mais amenas. Entretanto, muitos operadores já dão como certa uma quebra mais efetiva na safra brasileira e também um comprometimento da qualidade do grão. Agora, a tendência é o mercado iniciar uma nova etapa, na qual será feita uma avaliação desses possíveis prejuízos para a safra também se verificar se os preços têm consistência para "segurar" alguns parâmetros conquistados recentemente.

No encerramento do dia em Nova Iorque, a posição março teve baixa de 135 pontos, com 139,70 centavos de dólar por libra peso, com a máxima em 142,75 centavos e a mínima de 136,35 centavos, com o maio registrando queda de 120 pontos, com 141,95 centavos por libra, com a máxima em 144,75 centavos e a mínima em 138,40 centavos. Na Euronext/Liffe, o março teve alta de 2 dólares, com 1.824 dólares por tonelada, com o maio tendo valorização de 4 dólares, para o nível de 1.822 dólares por tonelada.

De acordo com analistas internacionais, o dia iniciou com consistência em Nova Iorque, com o março chegando a tocar no nível de 142,75centavos. Entretanto, as liquidações foram iniciadas logo na sequência, abrindo espaço para retrações mais fortes. Na segunda metade do dia, porém, algumas recompras foram identificadas e o fechamento se deu ainda com quedas, porém mais leves, com o março continuando próximo do referencial psicológico de140,00 cents. No segmento externo, dia de boas altas nas bolsas de valores dos Estados Unidos, queda do dólar ante uma cesta de moedas internacionais e poucas oscilações para as commodities softs.

"Com a possível interrupção do quadro de calor e seca no Brasil, os players agora se voltam para mais um ajuste das planilhas. No entanto, ninguém realmente sabe o que ocorreu com as lavouras do país. Ninguém tem um dimensionamento dos prejuízos. Desse modo, as contas desses participantes são ainda pouco efetivas e novos cálculos deverão ser realizados nas próximas semanas. Diante disso, o mercado parece temeroso em liquidar mais fortemente e a tendência é que alguns parâmetros sejam preservados", disse um trader.

Levantamento do Instituto Brasileiro de Geografia e Estatística aponta para uma safra brasileira 2014 de 2.968.989 toneladas, ou 49,5 milhões de sacas, acréscimo de 1,7% em relação à safra colhida de 2013.Mas segundo o Instituto, tudo indica que a safra 2014 será diferente dos últimos 21 anos, se confirmadas as atuais estimativas negativas para o café arábica. Em 2014, o Brasil deverá produzir 2.228.408 toneladas de café arábica, o que equivale a 37,1 milhões de sacas. Em 2013, que foi um ano de baixa produção, o país produziu 2.270.916 toneladas (37,8 milhões de sacas). Ou seja, o perfil de bienalidade mudou e em ano de safra cheia serão 800 mil sacas a menos ou 1,9 % abaixo da safra anterior.

As exportações brasileiras no mês de fevereiro, até o dia12, totalizaram 657.941 sacas de café, alta de 13,99% em relação às 577.178s acas embarcadas no mesmo período do mês anterior, de acordo com informações do Cecafé (Conselho dos Exportadores de Café do Brasil).

Os estoques certificados de café na bolsa de Nova Iorque tiveram queda de 5.045 sacas, indo para 2.629.025 sacas.

Tecnicamente, o março na ICE Futures US tem resistência142,75, 143,00, 143,50, 144,00, 144,15, 144,50-144,55, 145,00, 145,50, 145,80,146,00, 146,50, 147,00, 147,50, 148,00, 148,50 e 149,00 centavos de dólar, como suporte em 136,35, 136,00, 135,50, 135,00, 134,50, 134,00, 133,50, 133,00,132,90, 132,50, 132,05-132,00, 131,60-131,50, 131,00, 130,50, 130,10-130,00,129,50 e 129,00 centavos.

Londres mantém tranquilidade e fecha dia com pouca oscilação

Data: 13/02/2014

Os contratos futuros de café robusta negociados na Euronext/Liffe encerraram esta quinta-feira próximos da estabilidade, em uma sessão caracterizada pela predomínio das rolagens de posições. O março flutuou, ao longo de todo o dia, dentro de um range estreito, acima dos 1.800 dólares, mas sem conseguir testar a marca de 1.850 dólares.

De acordo com analistas internacionais, a sessão desta quinta-feira foi técnica, sem maiores novidades, seguindo o comportamento já expresso ao longo da terça e quarta-feira. As rolagens continuam a ser desenvolvidas, principalmente no intervalo de março para maio, com a segunda posição já contando com 39,6 mil contratos em aberto na casa de comercialização britânica.

"O que vemos é um movimento consolidativo. Os vendedores parecem não estar muito animados para negociar abaixo de 1.850 dólares, ao passo que encontramos um movimento que impede um avanço mais efetivo. De toda forma, o mercado se mostra consistente, principalmente se levarmos em conta que as origens asiáticas já voltaram aos negócios e, mesmo tendo vendido menos antes do ano novo lunar, no caso do Vietnã, essas liquidações não foram retomadas agora, com a clara expectativa de que o mercado pode ganhar ainda mais corpo", disse um trader.

O março teve uma movimentação ao longo do dia de 3,63 mil contratos, contra 7,72 mil do maio. O spread entre as posições março e maio ficou em 2 dólares.

No encerramento do dia, o março teve alta de 2 dólares, com1.824 dólares por tonelada, com o maio tendo valorização de 4 dólares, para o nível de 1.822 dólares por tonelada.

Olam sees rebound in coffee prices after profits drop

Reuters   -  Rujun Shen and Lewa Pardomuan

* Profit dips on lower sales volume, commodity prices

* Olam "neutral" on robusta, "friendly" on arabica

* Olam maintains bullish stance on cocoa (Adds comments from briefing, recasts)

SINGAPORE, Feb 14 - Commodities trading firm Olam International Ltd posted a 12.5 percent drop in second-quarter profit on weaker sales and commodity prices, but said a rebound in coffee prices would boost the sector's performance for the rest of the year.

The Singapore-based firm, a leading global coffee supplier, said its coffee business was impacted by weaker prices, which slumped to multi-year lows last November.

Sunny Verghese, managing director and chief executive officer, said he was bullish on arabica coffee prices but neutral on robusta prices.

"We are neutral on robusta prices largely on account of the fact that there's a very large crop in Vietnam -- almost 28 million bags, which is our estimate," Verghese told reporters.

Unusually dry weather in top producer Brazil, which mainly supplies arabica beans, could cut output in the next crop to an estimated 50 to 51 million bags from 57 to 60 million, he added.

"Structurally, we believe that the demand/supply fundamentals is now in favour of a firming market," Verghese said, referring to the arabica market.

Benchmark New York arabica futures rallied to 9-month peak in early February on concerns over drought in Brazil, up from a more than four-year low hit in November when oversupply concerns weighed on prices.

Arabicas often influence the price of London robustas and typically trade at a premium to the hardier and more caffeine-rich beans, which are widely used in instant coffee. Vietnam is the top robusta producer.

London robusta futures rallied to a six-month high earlier this month, climbing from a more than three-year low in November.

HIGH DEPRECIATION

Olam's profit after tax and minority interest (PATMI) for the Oct-Dec quarter dropped 12.5 percent to S$134.9 million.

Revenue in the quarter fell 8 percent to S$4.5 billion, affected by lower volume and softer commodity prices.

Its edible nuts, spices and vegetable ingredients, wheat milling, sugar refining, as well as dairy and cocoa supply chain businesses performed strongly, while upstream dairy and wood products performance were disappointing.

Olam said its volume for the 2014 financial year would be quite subdued, as it curbs activity in less attractive markets and restructures its cotton, wood, dairy, sugar businesses and commodity financial services.

"In all those businesses, there are some trade flows and volumes that we are deliberately giving up, because we feel that the bang for buck in terms of invested capital and working capital in the business to generate that volume is not attractive and we have better options," said Verghese.

For the first half of the financial year, the company managed a 5.4 percent gain in earnings before interest, tax, depreciation and amortisation (EBITDA), a gauge of profitability excluding the effects of financing and accounting decisions. But a 31.8 percent jump in depreciation and amortisation charges pushed core profit down 8.5 percent.

The high depreciation and amortisation charges were caused by a S$1 billion expansion in invested fixed capital, about half of which was in food staples and packaged food segment on assets including grain mills, palm plantations and rice farms.

Olam came under attack from short-seller Muddy Waters in late 2012 for its accounting practices, only to be rescued by its top shareholder, Singapore's sovereign investor Temasek Holdings (Private) Ltd. A few months later, it set out to cut its capital spending and debt levels.

Net gearing at the six-month period stood at 2.06 times, creeping up from 1.93 times a quarter earlier, but lower than 2.21 times a year earlier.

The company posted a negative free cash flow of S$282.2 million, a deterioration from a positive free cash flow of S$46 million reported a quarter earlier, but said it remains on track to generate positive free cash flow for the financial year 2014.

Olam is among the top global suppliers of coffee and cotton, and a key player in the global player in the global cocoa market. It maintained its forecast of 185,000-tonne deficit for 2013/14 for the global cocoa market.

Olam Sees Coffee Prices Firming, but Neutral on Robusta -- Market Talk

DowJones

Agricultural commodities trading firm Olam sees a "firming" in the coffee

market on demand-supply fundamentals, chief executive Sunny Verghese says at a briefing on the

company's second-quarter results Friday. The firm is "friendly" on arabica due to adverse dry

weather in Brazil, but neutral on robusta due to a bumper crop in Vietnam. Verghese says poor

weather in Brazil is likely to cut supply to 50-51 million bags from 57-60 million bags this year.

Arabica coffee for delivery in March on ICE Futures U.S. ended 1% lower at $1.3970 a pound Thursday

May-delivery lost 0.8% to settle at $1.4195 a pound. Liffe robusta coffee for March delivery ended

0.1% higher at $1,824 a ton Thursday. Arabica coffee ended last year 23% lower but has rebounded

sharply this year.

Coffee Is Just Starting To Heat Up

Feb. 13, 2014

Introduction

Over the past year, coffee prices lost 34.4%. Despite last year's losses, coffee is rapidly turning around due to an impending supply crunch, short squeeze, bullish technical patterns, and increasing macro demand.

Impending Supply Crunch

Over the past two weeks, coffee gained 20.1% due to concerns of a potential drought in the northeast and southwest regions of Brazil. Brazil is of central importance to the coffee market because it is the world's largest producer of coffee. Now that concerns of a Brazilian drought are looking increasingly likely, coffee's surge does not appear to be over. The graph I created below illustrates Brazil's effect on the supply of coffee using historical data from the International Coffee Organization.

As seen in the graph above, Brazil has a monumental effect on the global supply of coffee, and any supply disruption in Brazil hurts the global supply. Adding to supply crunch fears, the ICO (International Coffee Organization) has warned about the worst leaf rust outbreak since 1976. The ICO says:

The current epidemic of coffee leaf rust affecting all countries of the region with a 53% incidence is the worst seen since this pest appeared in Central America in 1976.

Leaf rust is a fungus that affects the leaves of the coffee plant, causing the leaves to develop pale-yellow blotches. Leaf rust devastates coffee plantations as each fungus produces an additional 300,000-400,00 spores over a 3-5 month period.

Impending Short Squeeze

As a result of coffee's poor performance over the past three years, coffee has become a safe haven for short sellers. Below, I have created two charts using 161 data points from the CFTC (Commodities Futures Trading Commission).

As the data show, coffee has been an easy short for traders in 2013. Over the past year, net short interest greatly expanded. The large increase in short positions will allow for continued short covering as shorts are caught off guard by the supply crunch in Brazil.

Bullish Technical Patterns

Due to the recent pop in coffee, the chart looks increasingly bullish.

As seen in the weekly chart from stockcharts.com above, multiple indicators are quickly turning bullish after long periods of bearish signals. Firstly, the breaking of long-term resistance on the RSI (relative strength index) indicates that coffee has newfound momentum that has been absent for the past several years. Secondly, the moves above both long-term resistance and the 50-day moving average highlight coffee's new strength. The Parabolic SAR (a momentum indicator), has also lined up nicely below the candlesticks. A final momentum indicator, the MACD (bottom), is also printing an incredibly bullish signal.

Increasing Macro Demand

While the supply side of the coffee equation moves prices higher, demand should help move coffee higher as well. In order to calculate how much coffee demand will grow in the future, I created the Coffee Consumption Importance Index. Statistics are from the International Coffee Organization and the World Bank. The index is calculated by multiplying the number of 60-Kg bags a country imports by its percentage population growth. Those two statistics represent how much demand for coffee will grow. The product is then divided by 10,000 to provide smaller numbers for comparison. The graph I created below shows where the world's 25 top coffee importers fall on the index. Given that the U.S. is an anomaly, with a reading of 1805, A separate graph is needed to compare the U.S.

The above charts highlight the growing demand for coffee, especially in established markets such as the U.S. and Belgium.

Conclusion

I suggest that investors take advantage of the new strength and momentum in coffee. Investors can buy shares or options of the iPath Dow Jones-AIG Coffee Total Return Sub-Index ETN (JO) and shares of the iPath Pure Beta Coffee ETN (CAFE). I especially advise investors looking to use options to spread to avoid paying too much in risk premium after the recent 20% move.

Brazil Coffee/Citrus/Cane...

Dry weather observed. Temperatures above normal with highs in the upper 80s

to middle 90s f.

Coffee/Citrus/Cane Forecast...

Mostly dry weather through Friday. Chance of scattered showers and

thunderstorms over the weekend. Rainfall totals of .25-.75 inch (4-20mm) with

locally heavier expected. The heaviest activity may favor Sao Paulo. Mostly dry

weather Monday-Wednesday. Temperatures above normal through Friday, variable

Saturday, near to below normal Sunday, near to above normal Monday, above

normal Tuesday-Wednesday.

The extended outlook calls for mostly dry weather on Thursday February 20.

Dry conditions or just a few light showers on Friday and Saturday February

21-22. Episodes of scattered showers and thunderstorms from Sunday February

23-Tuesday February 25. Light to moderate amounts with locally heavier are

possible. The heaviest activity may favor Sao Paulo. Dry conditions or just a

few light showers from WednesdayFebruary 26-Friday February 28.

WORLD COFFEE PROSPECTS

Little rainfall and mostly above normal temperatures in Sao Paulo and Minas

Gerais Brazil at this time stress developing coffee. Some productions losses

are expected. Some scattered showers and cooler temperatures are possible over

the weekend.

Mostly favorable weather for the remaining harvest in southern Mexico and

Central America.

The new main crop will flower in Colombia during March. The mid crop is

developing.

Mainly dry or with only a few light showers through coffee areas of central

Vietnam will favor the on going harvest.

Brazil's coffee belt grapples with rare threat: dry heat

Feb 12 (Reuters) - In Brazil's coffee belt, frost has long been the biggest risk for farmers and commodities traders alike. But after years of migrating to warmer regions, farmers here now find themselves scrambling to overcome an unusual phenomenon: blistering heat.

January was the hottest and driest month on record in much of southeastern Brazil, punishing crops in the country's agricultural heartland and sending commodities prices sharply higher in global markets. As signs emerged that the world's largest coffee crop was withering, futures prices shot up 26 percent over a seven-day stretch to a nine-month high.

The heat wave has thrust many Brazilian coffee farmers into the unknown. January, typically the wettest month for the coffee belt, caught most farmers off guard, leaving them with few options but to count their losses.

A few, such as Marcio Diogo, a third generation coffee farmer in Espirito Santo do Pinhal in Sao Paulo state, are scrambling to install irrigation lines to limit those losses, which may have reached 30 percent of output on his 75-hectare (185.2-acre) farm, according to his count.

"My grandfather started here 80 years ago ... never seen a January like this," Diogo said walking through a field of 25,000 freshly planted coffee trees that he ordered six months ago.

"I've had to water this field six times by tractor," he went on, something he normally doesn't have to do.

The drought couldn't come at a worse time for Diogo and other farmers, who have struggled with weak global coffee prices over the past two years. It's still unclear whether the recent spike in prices, in part driven by Brazil's drought, will eventually offset the loss in output from the dry weather.

Celso Scanavachi, an agronomist at the local coffee cooperative Coopinhal, said farms in the region got only 10-12 centimeters (3.9-4.7 inches) of rainfall in January, less than half the month's average precipitation.

Espirito Santo do Pinhal, nestled along the border between two of Brazil's biggest arabica growing states, Minas Gerais and Sao Paulo, is not alone.

Two hours to the north in southern Minas Gerais, which produces 25 percent of Brazil's coffee crop, between 4.5 and 8.6 centimeters of rainfall fell last month, when 26.5-30.1 centimeters are average. No doubt, 2014 will go down as the worst drought in recent history in Brazil's coffee belt.

The impact, however, is still hard to gauge. The government estimated the crop at up to 50 million 60-kg bags before the drought, while market estimates put it at 60 million bags. Future estimates will likely fall for several months as analysts and farmers get a more precise understanding of the damage.

"It's clear there will be losses but nobody knows yet how big because this has never happened. We are in uncharted territory," Lucio Dias said, a grower and sales director at Cooxupé, Brazil's biggest coffee cooperative.

Whatever the damage, the world is unlikely to run out of coffee anytime soon, thanks to the large stockpiles of beans amassed in recent years.

RELIEF ON THE HORIZON

Some short-term relief appears to be on its way. A cold front moved over southern Brazil on Wednesday and should bring some moisture to agricultural crops in the coming days, though widespread rainfall in the coffee belt is not expected until Feb. 20.

Still, it's unlikely the rains will be heavy enough to reverse the damage to the crops or make up for the rainfall lost in January and early February.

"Those are the peak months for the rainy season and they are over," said Celso Custodio, a senior meteorologist at forecaster Somar Meteorologia.

To be sure, Brazil's coffee belt has suffered droughts before, but rarely in January, when the Southern Hemisphere summer heat is offset by tropical downpours almost daily. The dry season runs from April through September, and can sometimes stretch into November but temperatures are lower then.

Volatility in coffee futures prices has traditionally come with frost, hints of which can send contract prices up 10 percent in a matter of minutes.

The cold snaps of 1975 and 1999, the worst in recent history, prompted farmers to migrate from the southernmost growing regions most exposed to polar air blasts in winter, into the warmer states of Minas Gerais, Bahia and Espirito Santo.

Subsequently, frost has had less of an impact on the coffee belt since. For more than a decade, coffee has only traded mildly on weather threats.

But this year's heat wave has changed that. Because a majority of Brazil's coffee farms are heavily reliant on rainfall, the first signs of a serious drought put markets on edge.

Coffee futures prices in New York started January at just under $1.12/lb and now are pushing $1.41/lb.

"Although irrigation is common in areas like the Cerrado or Espirito Santo or western Bahia where it is more arid, nobody has invested in it in South Minas because it has always rained in January here," Dias, of Cooxupé, said.

TALLYING THE LOSSES

Accurately estimating the losses to the entire crop in Brazil, the world's main supplier of natural - or sun-patio cured - arabicas, is a monumental task fraught with complexity.

Overseeing a crew installing an irrigation line to a slope of three-year-old trees that are particularly at risk to dry weather due to their less developed roots and foliage, Diogo surveyed the young trees deceptively full of coffee fruit.

He reached down and stripped a bow full of unripe coffee fruit and cut cross sections through several of the fruit with his pocket knife showing voids inside where pale green beans would normally be forming if there had been rain.

After testing coffee fruit on several trees of varying ages, Diogo estimated that he would harvest less than 40 bags a hectare this year, if he's lucky, and not anywhere close to the 65 bags a hectare he brought in last season.

"The flowering of this crop was nearly perfect. Our hopes were high," Diogo said as he pinched coffee cherries to test if they had succumbed to the drought.

Coffee trees are commercially productive for a little more than 25 years but must then be ripped out and replanted. The youngest trees, or about 25 percent of Brazil's crop, are most at risk to hot, dry weather. As much as 50 percent of the beans on trees up to two years old in Espirito Santo do Pinhal are likely lost without hope of recovery, even if rains came today, according to Scanavachi, the agronomist.

Older trees of more than 10 years showed only minor losses of less than 10 percent to the drought. Most trees, young and old, showed very little growth in their branches and foliage, which will hold and shade the fruit in the coming crop.

"Trees have lost productive potential for the next year, too," Scanavachi said.

Brazil Coffee Weather - Feb 13

SAO PAULO AND MINAS GERAIS

SUMMARY- Mostly dry during the past 24 hours. Temperatures 86-97F (30-36C).

FORECAST-

TODAY...Mostly dry conditions. Temperatures 86-97F (30-36C).

TONIGHT...Mostly dry conditions. Temperatures 62-73F (17-23C).

TOMORROW...Mostly dry or a few light showers. Temperatures 86-96F (30-36C).

OUTLOOK...Mostly dry or a few light showers Saturday through Monday.

Temperatures mostly above normal.

BRAZIL COFFEE PROSPECTS...

Mostly above normal temperatures and limited rainfall during the next 5 days

will deplete soil moisture and increase stress. Some production losses are

possible. Some increase in showers are expected late this week or weekend

across far southwest areas.

Goldman lifts coffee price hopes, but wary on ags

Goldman Sachs raised its forecast for coffee prices, thanks to a Brazilian drought deemed by Cooxupe as turning beans into "bubble wrap", but the bank remained downbeat on prospects for agricultural commodity prices.

Goldman Sachs raised by 10 cents a pound its forecast for New York coffee futures, citing the "hot and dry weather conditions" in major growing areas in Brazil, the top producer of the bean.

"These weather conditions are expected to impact the 2014 arabica coffee crop, which was up to now expected to be record large," the bank said.

Indeed, the comments came amid continued reports from Brazil of crop losses, including in Espirito Santo, Brazil's main area for growing robusta coffee beans, which was thought to be relatively resistant to dryness because of more widespread irrigation than other areas.

However, according to state research institute Incaper, producers are expecting losses of some 20% on a crop originally forecast at 12m-12.5m bags.

'Resemble bubble wrap'

In Minas Gerais, Brazil's main coffee growing state, many newer planted trees have failed completely, according to Lucio Dias, commercial superintendent at Brazil-based Cooxupe, the world's largest coffee co-operative.

"Older crops are still holding on, but smaller ones are suffering a lot," Mr Dias said.

"The grains resemble bubble wrap, because there is only air inside."

"We are seeing a lot of empty grains, beans and many voids," he said, warning that the impact of the dryness would likely be felt in 2015 too, given that branches on which next year's flowers will bud are already growing.

"This drought is unprecedented - we have never had it as dry in January and February as we are having now," with limited knowledge of the impact of poor weather at this time of year.

For producers, "the consequences may be worse than they are anticipating".

Soybean recommendation

Nonetheless, Goldman Sachs left its forecast for corn prices, at 130 cents a pound on three, six and 12-month horizons, below the futures curve.

"High stock levels after several years of surpluses will help cushion this production shortfall," the bank said, adding that a one-off short-covering drive by speculators had likely boosted the revival in prices, which have risen by 27% so far this year on the Ice futures market.

Indeed, although the bank acknowledged that risks to its coffee futures forecasts were "skewed to the upside", it remained downbeat on crop prices overall, foreseeing a 9.0% fall over the next year.

It retained a short recommendation on both old crop soybeans and Chicago's new crop December corn contract, foreseeing prices of the oilseed standing at $9.50 a bushel in a year's time, a level not seen since July 2010.

Concerns over emerging market economies only underlined the prospect of soybean price falls, the bank said.

Hog hopes

Goldman's forecasts for wheat, cotton and cocoa futures were left below the futures curve too, with the bank warning over the fibre that "the outperformance of prices relative to corn prices will likely support acreage and production in 2014-15, which will bring inventories higher in 2014", so weighing on prices.

However, the bank forecast livestock prices holding their ground over the next 12 months, cautioning that its ideas of Chicago lean hog futures standing at 80 cents a pound in a year's time, after hitting 100 cents a pound in the late summer, may prove pessimistic.

A rally in summer lean hog futures lots this year, attributed largely to fears over the growing extent of US losses to porcine epidemic diahorrea virus (PEDv), "has taken prices slightly above our price forecast".

"The elevated uncertainty around the severity and impact of the PED virus leaves risk to our forecasts skewed to the upside," the bank said, also highlighting talk that Russia may this spring lift a ban on imports of US pork, imposed over the use in America of growth promoting drugs.