Bloomberg News

Brazil Good-Cup Coffee Discount Widens as Demand Slows Down

May 11, 2012

Buyers of good cup-quality coffee from Brazil, the world’s largest producer of the commodity, are getting a bigger discount for their beans amid slower demand, according to Volcafe, a unit of ED&F Man Holdings Ltd.

Good-cup beans for June and July shipment were trading at a discount of 18 cents a pound to prices on ICE Futures U.S. in New York, data from the trader show. That compares with a 15- cent discount last week.

“Differentials have softened a little, but there is very little interest for nearby,” the Winterthur, Switzerland-based trader said in a report e-mailed today. A differential is a discount or premium for physical coffee relative to futures prices.

In the Brazilian market, producers released “decent volumes,” according to Volcafe.

Arabica coffee for July delivery dropped 0.3 percent to $1.7815 a pound by 10:58 a.m. on ICE.

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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