Arabica coffee beans of good cup quality from Brazil, the world’s largest producer of the commodity, were trading at a discount this week, with a U.S. roaster buying, according to Flavour Coffee.
The beans traded at a discount of 18 cents a pound to the price on the ICE Futures U.S. exchange in New York, the Rio de Janeiro-based broker said in a report e-mailed today. That compares with a discount of 19 cents a pound last week. Arabica coffee futures slid 0.2 percent over the past week as a record crop in Brazil continued to put pressure on prices. The commodity has dropped 37 percent this year, making it the worst performer in the Standard & Poor’s GSCI gauge of raw materials.
“Reasonable volume of good cup qualities traded this week, all for nearby January shipments,” Flavour Coffee said. “It is noticeable a purchase made from one major USA roaster.”
Arabica coffee beans of fine cup quality were at a discount of 10 cents a pound to the futures price, according to the broker. That compares with 9 cents a pound a week earlier. Fine cup beans are usually more expensive due to their taste profile.
Coffee output in Brazil this year rose more than previously forecast to a record 50.8 million bags, the government said this week. The estimate was raised from 50.5 million bags forecast on Sept. 6, the Agriculture Ministry’s Conab crop-forecasting agency said. A bag of coffee weighs 132 pounds.
Conillons, as Brazilian robusta beans are known, were at a premium of 12 cents a pound ($265 a metric ton) to the price on the NYSE Liffe exchange in London, down from 15 cents a pound a week earlier, according to Flavour Coffee data. Offers for beans from the next crop, with shipment in May and June, were at a premium of 5 cents to 7 cents a pound, the broker said.
Arabica coffee is grown mainly in Latin America and favored for specialty drinks such as those made by Starbucks Corp. (SBUX:US) Robusta beans are harvested mainly in Asia and parts of Africa and are used in instant coffee and espresso.
Robusta coffee for March delivery slid 0.6 percent to $1,876 a ton by 9:39 a.m. in London. Arabica coffee for March delivery was unchanged at $1.4295 a pound in New York.
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.