New York coffee ends firmer

Arabica benchmark coffee futures settled with modest increases on Wednesday, with trade thin as prices consolidated recent wide fluctuations and participants waited for clearer direction, dealers said.
"It was pretty much a consolidation day, nothing much around," said one coffee dealer. Prices opened lower, but a lack of follow-through selling allowed a few buyers to emerge.
When they held onto positive territory a large buy order paved the way to higher levels. But traders said volume was light with switching business accounting for about a third of the paltry total.
The New York Board of Trade's arabica coffee contract for December delivery finished 0.20 cent higher at $1.0445 a lb. The range spanned $1.0375 to $1.05 a lb. March coffee futures gained 0.25 cent by the end at $1.0835 a lb. The rest finished mostly higher, with increases of 0.05 to 0.25.
The last issue on the board ended down 0.40. NYBOT estimated final arabica volume was light at 7,799 lots versus on Tuesday's count at 14,663 lots. Coffee prices currently sit near the middle of a larger range with some players wanting to buy. But after on Monday's extreme declines, traders said bulls need reassurance that a floor has been laid before adding to positions.
"Some people think, looking at the fundamental side, the market does not belong here and should go higher. But they don't have the courage to buy here," said one dealer. He added that a gain above $1.07 a lb in the December contract would likely draw origin sellers. "And there is industry interest to buy if it goes way below where we are now.
So we're probably more inclined to go to the downside," he said. The upside was limited on Wednesday in part when other coffee roasters failed to follow Procter & Gamble's lead in raising some of their coffee prices to retailers. On Tuesday, coffee prices turned higher when P& G raised prices it charges retailers for some Folgers products.
In London, the Liffe benchmark November robusta contract added $14 to end at $1,525 a tonne. Trade and industry buying in London were triggered by gains in New York arabica. Traders in Indonesia said on Wednesday that tight coffee bean supplies from plantations in that country's main growing areas of Sumatra have slowed trade.
They added, however, that trade in Mandheling arabica is likely to be strong as the main harvest season gets under way at the end of the month.
US weather forecaster Meteorlogix said it expects showers in top arabica grower Brazil to dissipate on Wednesday night. But it predicts scattered light rains to resume on Thursday. Later in the week, the report said to look for heavier scattered rains and thunderstorms.
Temperatures should remain near to above normal through on Saturday, falling to below normal on Sunday Meteorlogix added that significant spring rains are needed to improve tree conditions and increase flowerings.