Arabica coffee futures for September delivery rose Thursday, lifted bybullish charts and a weak U.S. dollar.
Most active September coffee added 2.2 cents, or 1.3%, to settle at $1.671 apound on ICE Futures U.S. Futures closed off their strongest levels of the day as traders took profits.
Coffee continues to find fundamental support from extremely tight supplies oftop-quality arabica beans in Central America and Colombia, though traderslargely attributed Thursday's gains to a strong chart picture.
Early buying took September coffee up to $1.67-$1.672, where it activated preprogrammed buy stops that took the market to its highs, said Hernando de laRoche, managing director of coffee trading at Hencorp Futures in Miami.
September coffee hit an intraday peak of $1.6945--a 2 1/2-week high--before traders began to take profits.
Background support emerged from a weak U.S. dollar and buying in the commodity indexes, which encouraged speculative interest in coffee.
Declines in equity markets due to economic concerns caused some nervousnessin commodities and encouraged late selling in coffee, a broker said.
Coffee futures have been trapped in a range from $1.55 up to $1.70 a pound.
The ability of September coffee to pierce through $1.70 would suggest further gains, while a breakdown below $1.55 would have bears targeting $1.50, then$1.45, said Rodrigo Costa, vice president of institutional sales at NewEdge inNew York.
Brazilian producers continue to see strong demand for their coffee, as internal prices rise, traders said.
Despite expectations for a bumper 2010-11 crop, beans are trickling in from Brazil's early harvest. Supplies are expected to remain tight in the near term and provide continued support for physical prices.
The International Coffee Organization said last week it expects Brazil's cyclically large crop to reach 50 million bags.
ICE coffee futures have rallied 24% since early June as supplies oftop-quality arabica beans became scarce due to adverse weather in Colombia and Central America.
Total open interest on ICE rose 498 to total 172,370 lots.
Most active September coffee added 2.2 cents, or 1.3%, to settle at $1.671 apound on ICE Futures U.S. Futures closed off their strongest levels of the day as traders took profits.
Coffee continues to find fundamental support from extremely tight supplies oftop-quality arabica beans in Central America and Colombia, though traderslargely attributed Thursday's gains to a strong chart picture.
Early buying took September coffee up to $1.67-$1.672, where it activated preprogrammed buy stops that took the market to its highs, said Hernando de laRoche, managing director of coffee trading at Hencorp Futures in Miami.
September coffee hit an intraday peak of $1.6945--a 2 1/2-week high--before traders began to take profits.
Background support emerged from a weak U.S. dollar and buying in the commodity indexes, which encouraged speculative interest in coffee.
Declines in equity markets due to economic concerns caused some nervousnessin commodities and encouraged late selling in coffee, a broker said.
Coffee futures have been trapped in a range from $1.55 up to $1.70 a pound.
The ability of September coffee to pierce through $1.70 would suggest further gains, while a breakdown below $1.55 would have bears targeting $1.50, then$1.45, said Rodrigo Costa, vice president of institutional sales at NewEdge inNew York.
Brazilian producers continue to see strong demand for their coffee, as internal prices rise, traders said.
Despite expectations for a bumper 2010-11 crop, beans are trickling in from Brazil's early harvest. Supplies are expected to remain tight in the near term and provide continued support for physical prices.
The International Coffee Organization said last week it expects Brazil's cyclically large crop to reach 50 million bags.
ICE coffee futures have rallied 24% since early June as supplies oftop-quality arabica beans became scarce due to adverse weather in Colombia and Central America.
Total open interest on ICE rose 498 to total 172,370 lots.
Futures volume is pegged at 19,446 contracts, with 4,532 calls and 8,715 put options traded.
ICE Change (cents) Range
ICE Change (cents) Range
July $1.6480 up 2.2 $1.6435-$1.6675
Sep $1.6710 up 2.2 $1.6430-$1.6945
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