Coffee futures continued to fall Friday with much-needed rain in the forecast for Brazil at a time when crops have suffered from drought.
Arabica coffee for December lost 0.9% at $1.274 a pound on the ICE Futures U.S. exchange, on track to close at the lowest level since July 11.
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"For bears hoping for rains, they are here," said Thiago Marquez Cazarini, a coffee broker with Cazarini Trading Co. in Brazil, the world's largest growing region. "For bulls, they are not enough yet and situation is already critical. For me, too early anyways for guessing or making heavy bets."
A Cazarini Trading survey of trade houses found that traders are expecting the market to end the year at $1.3567 a pound but that it could have further to fall before climbing back to those levels.
ED&F Man's Volcafe Ltd. said in a note Friday that producers in Brazil have been holding coffee stocks to force exporters with short positions in the market to pay to cover their nearby shipment commitments.
WeatherBELL Analytics in New York said that over the past week it was dry in most of Brazil but wetter in far northeastern Brazil, in extreme southern Rio Grande do Sul and in isolated parts of Mato Grosso. Some of the northwestern coffee areas were also wetter, the firm said.
In other markets, raw sugar for March was off 0.7% at 13.85 cents a pound, cocoa for December rose 1.6% to $2,012 a ton, frozen concentrated orange juice for November rose 0.1% to $1.472 a pound and December cotton slumped 0.4% to 68.69 cents a pound.
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(END) Dow Jones Newswires
September 29, 2017 11:13 ET (15:13 GMT)