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Nov. 11 (Bloomberg) -- Arabica coffee rose, capping the first weekly gain in three, after an industry group cut its estimate for global production because adverse weather hurt crops and delayed harvests. Cocoa was steady, while cotton fell.
The International Coffee Organization cut its outlook for world output in the season started last month to 127.4 million bags from a previous forecast of 129.5 million bags in September. Rainfall hurt crops in Indonesia and Latin America, the London-based group said yesterday. A bag weighs 60 kilograms, or 132 pounds.
“Futures still have to deal with a tight supply situation for the short term,” Jack Scoville, a vice president at Price Futures Group in Chicago, said in a e-mailed report. Growers in Central America and Colombia are offering beans from the new crop at high prices in the cash market, he said.
Arabica coffee for March delivery rose 1.7 percent to settle at $2.373 a pound on ICE Futures U.S. in New York, marking a weekly gain of 3.1 percent.
Exports from Brazil, the world’s top grower, fell 12 percent in October from a year earlier, the country’s council for green-coffee exporters, known as Cecafe, said Nov. 8.
“The market has a strong support coming from roasters,” Thiago Cazarini, a broker at Varginha, Brazil-based Cazarini Trading Co., said in an e-mail. “Producers have strong hands now, which makes the price likely to be squeezed higher. Brazil supply will tighten even further.”
Cocoa futures for March delivery were unchanged at $2,559 a metric ton on ICE. This week, the chocolate ingredient tumbled 6.3 percent, the most in two months.
Cotton futures for March delivery retreated 0.8 percent to 98.04 cents a pound on ICE. The fiber dropped 0.4 percent this week, its second straight loss.
In London futures trading, robusta coffee rose, while cocoa fell.
--Editors: Millie Munshi, Steve Stroth
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