Bloomberg News

Honduran Coffee Beans Trade at Premium on Delays, Volcafe Says

December 16, 2011

Dec. 16 (Bloomberg) -- Sellers are demanding a premium for coffee from Honduras, Central America’s largest producer, reversing a discount last week, as rains delay bean arrivals, according to Volcafe, the coffee unit of ED&F Man Holdings Ltd.

Honduran beans are at a premium of 5 cents a pound to the price on the ICE Futures U.S. exchange in New York, up from a discount of 2 cents a pound last week, data from the Winterthur, Switzerland-based trader showed.

“A cold front and some rains are further delaying the arrival of the coffee,” Volcafe said in a report e-mailed today. “Internal prices are firming up as exporters are still in need of coffee to cover their nearby commitments.”

The premium to obtain coffee from Colombia, the world’s second-largest producer of arabica coffee, climbed to 25 cents a pound from 22 cents a pound last week, according to Volcafe.

The weather “remains a problem,” the trader said. “Coffee flow continues to disappoint.” Brazil is the biggest producer.

Colombia’s 2011-12 production will “struggle” to reach 7 million bags, Volcafe estimated on Dec. 13. The country’s crop has been damaged due to rains caused by the La Nina weather pattern, which is associated with cooler than normal water temperatures in the Equatorial Pacific Ocean.

--Editors: Sharon Lindores, John Deane

To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.


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