Arabica coffee futures fell Thursday amid anticipation for a record arabica crop from the harvest that is now ending.
Arabica coffee for December fell 0.7% to end at $1.285 a pound on the ICE Futures U.S. exchange, its lowest close in three weeks.
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The International Coffee Organization expects coffee production to reach a record 153.9 million bags worldwide for the now-ending 2016-17 season, about 97.3 million bags of which is arabica. With consumption assumed at 155.1 million bags, that leaves consumption outstripping new supply by 1.2 million bags.
Analysts are anticipating further deficits in 2017-18 following erratic rains in Brazil, the world's largest growing region. However, above-normal rainfall forecast over the next week in key growing regions is bringing out bearish traders.
According to WeatherBELL analytics in New York, rainfall has been erratic in all growing areas during Brazil's wet season and very dry in arabica areas, but recently prospects have improved.
"August was dry to start, but a big increase in rainfall occurred in arabica zones in the middle of the month," the firm said, adding that showers are expected in the coming week.
MDA Weather Services said showers late this week and weekend in central and southern coffee areas could initiate flowering. Still, Commerzbank said in a note this week that it expects further deficits in coffee, with reports of smaller beans than usual in Brazil because of the long dry period and a berry borer infestation.
In other markets, raw sugar for March was up 0.9% to settle at 13.95 cents a pound, cocoa for December lost 1.7% to end at $1,980 a ton, frozen concentrated orange juice for November lost 2% to $1.47 a pound, and December cotton ended up 0.5% to settle at 68.97 cents a pound.
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(END) Dow Jones Newswires
September 28, 2017 17:51 ET (21:51 GMT)