Arabica coffee futures edged lower as prices consolidated after last week's rally to 12-year highs, with outside pressure coming from a weak commodity sector and a firm dollar.
Nearby July coffee lost 0.70 cent, or 0.42%, to end at $1.6630 on ICE Futures U.S. Most active September lost 0.80 cent, or 0.47%, to settle at $1.6810.
Coffee futures have taken a breather in the last two sessions after vaulting to 12-year highs last week. Traders may be content to hold prices in narrow ranges as they assess the market's new trading parameters. September coffee rallied to a top of $1.7650 last Thursday but closed at $1.6875, as traders took profits off the newly minted 12-year peak and producers sold. Tight supplies of quality arabica beans continue to support the market, but there are signs that the supply situation may be softening.
The market rally has been centered more on chart aspects than on fundamentals, as the global supply balance has been snug for some time, said Hussein Allidina, veteran analyst with Morgan Stanley.
Tight supplies are now beginning to release their grip on the market with the onset of the large Brazilian coffee harvest, he said in a research note.
In addition to supply concerns, coffee futures have shot up dramatically in the last two weeks because of "unfounded" frost concerns in Brazil. The weather scares, combined with a persistent fall in warehouse stocks, caused coffee futures to climb 25% in the last two weeks, said Allidina.
He projects global 2010-2011 arabica coffee output to rise by 14.2 million bags, year-on-year, with ending stocks seen increasing by nearly five million bags to 367.2 million.
ICE coffee's climb brought out increased producer selling above $1.70 a pound, a signal that the market may be forming a top, said Boyd Cruel, senior softs market analyst at Vision FinancialMarkets
in Chicago.
The rally was "way overdone," and with the Brazilian harvest picking up momentum, prices would be expected to fall more in line with the fundamentals, said Cruel.
The high coffee prices and dry conditions have pushed Brazilian farmers to harvest 32% of the expected 41.5 million bags of arabica coffee through June 23, ahead of the average pace, an analyst with Safras & Mercado said Monday. Of the total arabica and robusta crop, Brazilian farmers have harvested 43% of the 54.6 million 60-kilogram bags.
Weather in Brazil is expected to remain dry until July 11-12, when a cold front will bring two days of rain, forecasters said. They see no risk of crop-damaging frost in the main growing regions.
Coffee futures also found outside market pressure on a lower trade in the commodity indexes and a firming U.S. dollar. A stronger dollar is normally bearish for commodities as it makes them more expensive in other currencies.
ICE warehouse stocks fell 12,286 bags to total 2.23 million 60-kilogram bags, the exchange reported.
ICE open interest fell 874 to total 164,101 lots. Volume is pegged at 9,471 lots traded, with 3,945 calls and 4,258 put options traded.
Nearby July coffee lost 0.70 cent, or 0.42%, to end at $1.6630 on ICE Futures U.S. Most active September lost 0.80 cent, or 0.47%, to settle at $1.6810.
Coffee futures have taken a breather in the last two sessions after vaulting to 12-year highs last week. Traders may be content to hold prices in narrow ranges as they assess the market's new trading parameters. September coffee rallied to a top of $1.7650 last Thursday but closed at $1.6875, as traders took profits off the newly minted 12-year peak and producers sold. Tight supplies of quality arabica beans continue to support the market, but there are signs that the supply situation may be softening.
The market rally has been centered more on chart aspects than on fundamentals, as the global supply balance has been snug for some time, said Hussein Allidina, veteran analyst with Morgan Stanley.
Tight supplies are now beginning to release their grip on the market with the onset of the large Brazilian coffee harvest, he said in a research note.
In addition to supply concerns, coffee futures have shot up dramatically in the last two weeks because of "unfounded" frost concerns in Brazil. The weather scares, combined with a persistent fall in warehouse stocks, caused coffee futures to climb 25% in the last two weeks, said Allidina.
He projects global 2010-2011 arabica coffee output to rise by 14.2 million bags, year-on-year, with ending stocks seen increasing by nearly five million bags to 367.2 million.
ICE coffee's climb brought out increased producer selling above $1.70 a pound, a signal that the market may be forming a top, said Boyd Cruel, senior softs market analyst at Vision Financial
The rally was "way overdone," and with the Brazilian harvest picking up momentum, prices would be expected to fall more in line with the fundamentals, said Cruel.
The high coffee prices and dry conditions have pushed Brazilian farmers to harvest 32% of the expected 41.5 million bags of arabica coffee through June 23, ahead of the average pace, an analyst with Safras & Mercado said Monday. Of the total arabica and robusta crop, Brazilian farmers have harvested 43% of the 54.6 million 60-kilogram bags.
Weather in Brazil is expected to remain dry until July 11-12, when a cold front will bring two days of rain, forecasters said. They see no risk of crop-damaging frost in the main growing regions.
Coffee futures also found outside market pressure on a lower trade in the commodity indexes and a firming U.S. dollar. A stronger dollar is normally bearish for commodities as it makes them more expensive in other currencies.
ICE warehouse stocks fell 12,286 bags to total 2.23 million 60-kilogram bags, the exchange reported.
ICE open interest fell 874 to total 164,101 lots. Volume is pegged at 9,471 lots traded, with 3,945 calls and 4,258 put options traded.
ICE Change Range
July $1.6630 dn 70 $1.6600-$1.6800
Sep $1.6810 dn 80 $1.6740-$1.7065
Nenhum comentário:
Postar um comentário