Arabica coffee prices dipped 1.3% to $3.82 per lb on Friday, yet remain set for a weekly gain. Concerns about Brazil’s dry weather persist, affecting crop outlook. Meanwhile, cocoa futures rose 1.8% with a projected global surplus, while raw sugar futures increased by 0.8%.
On Friday, Arabica coffee futures saw a slight decline of 1.3%, settling at $3.82 per lb, despite being poised for a weekly increase of 2.4%. The market is currently fixated on the upcoming crop forecast from Brazil, the leading producer of Arabica coffee.
Brazil’s dry weather conditions continue to raise concerns among producers. While some rain is anticipated, the potential positive impact on crop yields remains uncertain. Weather service Maxar noted, “Unfavourable soil moisture and mostly dry conditions will not support cherry growth,” indicating that Brazil is likely to experience drier weather for the next five days.
In response to rising prices, global coffee traders have significantly reduced their purchases, leading to a minimal buying environment. Meanwhile, Robusta coffee futures also experienced a decrease of 0.2%, priced at $5,417 per metric ton.
In the cocoa market, New York cocoa futures increased by 1.8% to $8,334 per ton, although the market is trending toward a weekly loss of 8.7%. The International Cocoa Organization noted a projected global surplus of 142,000 tons for the 2024/25 season, which has tempered price expectations.
Despite the surplus, BMI reported that tight stock levels may keep prices elevated, emphasizing market volatility. London cocoa rose by 0.8%, reaching 6,496 pounds per ton.
In the sugar market, raw sugar futures rose by 0.8% to 18.28 cents per lb, while white sugar futures increased by 0.5%, hitting $519.50 per ton.
The recent fluctuations in Arabica coffee prices underscore the ongoing concerns regarding Brazil’s weather and its impact on upcoming crop yields. Concurrently, cocoa and sugar markets reflect differing dynamics, with cocoa prices influenced by production forecasts and sugar futures demonstrating resilience amidst price movements. Overall, industry traders are adapting to market pressures and changing weather conditions.
Original Source: www.tradingview.com
