Arabica coffee may fall for a third day in New York, the longest losing streak in six weeks, after trees in top producer Brazil started to flower before the next crop and rainfall is forecast later this month. Sugar fell.
The first flowering before the 2013-14 crop occurred on the southern part of Minas Gerais, the largest arabica-producing state, according to Rio de Janeiro-based broker Flavour Coffee. Blossoming is likely to cover 25 percent to 40 percent of the trees’ production potential, it said in a weekly report e-mailed yesterday. Flowering has also taken place in irrigated areas of Cerrado, according to Cazarini Trading Co. in Varginha, Brazil.
Coffee climbed 6.9 percent in the week to Oct. 3 on concern dry weather would cause flowers to abort, reducing the size of the next crop. A new cold front will bring widespread rains to Brazil’s coffee growing areas after Oct. 10, Sao Paulo-based weather forecaster Somar Meteorologia said yesterday.
“On the ground in Brazil, there is not so much concern about dry weather and the flowering,” Kona Haque, an analyst at Macquarie Group Ltd., said by phone from London today. “On the back of the recent rally, you’ve seen a lot of central American countries and Colombia starting to sell.”
Arabica coffee for December delivery was little changed at $1.752 a pound by 8:11 a.m. on ICE Futures U.S. in New York, after dropping as much as 4.2 percent yesterday. Robusta coffee for November delivery slid 0.4 percent to $2,143 a ton.
“This year, with soil moisture levels already high, the wait for the back-up rains is not quite as crucial as, for example, last year,” Volcafe, the coffee unit of commodities trader ED&F Man Holdings Ltd., said in a report e-mailed today. “Rains by next weekend are a reasonable outcome.”
Robusta coffee slid after inventories gained, surprising many traders, said Jerome Jourquin, the head of agricultural commodity derivatives at Aurel BGC, a broker in Paris. Stockpiles with valid grading certificates in warehouses monitored by NYSE Liffe were 130,280 tons as of Oct. 1, up 0.6 percent from two weeks earlier, exchange data showed.
Raw sugar for March delivery slid 0.9 percent to 21.38 cents a pound in New York. White, or refined, sugar for March delivery fell 0.3 percent to $584.50 a ton in London.
Cocoa for December delivery was little changed at $2,397 a ton on ICE. Cocoa for March delivery was up 0.2 percent to 1,541 pounds ($2,494) a ton on NYSE Liffe.