New York coffee lower

Arabica coffee extended nine-month lows on Monday on technical and speculative selling as investors rolled out of a contract approaching delivery and speculators reacted to a drop in other commodities.
The New York Board of Trade's active coffee contract for September delivery fell 0.45 cents to conclude at 97.25 cents a lb, having dealt from 97.00 to 97.90 cents. Front-month July slid 0.30 cents to 94.95 cents and back months shed 0.35 to 50 cents.
Technical analysts put support for September at 95 cents and resistance at 100 cents. "There was some spec selling but mostly it was switching as people were getting out of July," Rodrigo Courier ad Costa, a coffee trader at Fimat, said on Monday.
Non-commercial participants have been rolling out of NYBOT's July contract before the June 22 first notice day for delivery. Traders said the market was also under pressure from a drop in prices of metals right through to grains.
"I look at my screen and everything on it is red," said another dealer. "It's not a situation where people would get too friendly to coffee, although there's reports of some cold weather approaching Brazil which the market's already discounted."
Weather forecaster Meteorlogix predicted on Monday that top coffee grower Brazil would mostly see dryness, with conditions generally favourable for maturing coffee beans. "There is no damaging cold in sight," it said.
The latest long-range forecast "could bring some cooler weather to the (Brazilian) coffee belt during the middle of next week," Meteorlogix said.
"However, no damaging cold is indicated as the jet stream will be split and the core of significant cold air is forecast to move across southern Argentina," it added.
Analysts have said Brazil's new coffee harvest is speeding up, with 20 percent of an estimated 43.5 million 60-kg crop picked by June 7. Brazil's government in April projected the 2006/07 (July/June) crop to grow about 23 percent from the previous season to 40.62 million 60-kg bags, thanks in large part to an upturn in arabica's biennial crop cycle.