U.S. arabica coffee closed slightly higher on Monday on views that supplies out of Central America will remain tight for some time, but the commodity's upside was limited by the stronger tone in the U.S. dollar for much of the day.
Nearby May coffee closed up 0.75 cent, or 0.57%, at $1.3255 per pound on ICE Futures U.S. Most-active July coffee closed up 0.70 cent, or 0.53%, at $1.3265.
"The fundamentals for coffee are pretty strong in the short term," said Rodrigo Costa, vice president of institutional sales at Newedge.
High-quality coffee from Colombia and other nations in Central America are likely to be limited for some time, he said. This has been a frequently cited theme among analysts lately, especially after a Broca infestation damaged production in Caldas, the third-largest coffee-growing province in Colombia.
Meanwhile, Costa said, any bearishness on ideas that Brazil's crop will be large is already factored into the market. Furthermore, there may be a tendency for Brazilian producers to initially sell their lower-quality beans first, Costa said.
However, he said, coffee's upside was limited since the dollar was stronger for much of the session. The euro, hurt by ongoing Greece debt concerns, was at $1.3330 as the coffee market closed, down from $1.3372 late Friday. A stronger dollar tends to hurt commodities generally by making them more expensive for holders of other currencies.
ICE coffee open interest--the number of active positions left at the end of the session--increased 1,222 positions Friday to total 135,041, according to exchangedata
.
Coffee electronic volume as of 1:30 p.m. EDT (1730 GMT) Monday was estimated at 9,181 lots. In floor options trading, there were approximately 7,692 calls and 4,616 puts, according to exchange data.
Nearby May coffee closed up 0.75 cent, or 0.57%, at $1.3255 per pound on ICE Futures U.S. Most-active July coffee closed up 0.70 cent, or 0.53%, at $1.3265.
"The fundamentals for coffee are pretty strong in the short term," said Rodrigo Costa, vice president of institutional sales at Newedge.
High-quality coffee from Colombia and other nations in Central America are likely to be limited for some time, he said. This has been a frequently cited theme among analysts lately, especially after a Broca infestation damaged production in Caldas, the third-largest coffee-growing province in Colombia.
Meanwhile, Costa said, any bearishness on ideas that Brazil's crop will be large is already factored into the market. Furthermore, there may be a tendency for Brazilian producers to initially sell their lower-quality beans first, Costa said.
However, he said, coffee's upside was limited since the dollar was stronger for much of the session. The euro, hurt by ongoing Greece debt concerns, was at $1.3330 as the coffee market closed, down from $1.3372 late Friday. A stronger dollar tends to hurt commodities generally by making them more expensive for holders of other currencies.
ICE coffee open interest--the number of active positions left at the end of the session--increased 1,222 positions Friday to total 135,041, according to exchange
Coffee electronic volume as of 1:30 p.m. EDT (1730 GMT) Monday was estimated at 9,181 lots. In floor options trading, there were approximately 7,692 calls and 4,616 puts, according to exchange data.
Change Range
May $1.3255 up 0.75c $1.3180-$1.3275
July $1.3265 up 0.70c $1.3185-$1.3340
Of DOWJONES NEWSWIRES
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