US arabica coffee futures closed quietly lower on Friday as the market consolidated on local liquidation and origin selling while participants adjusted to the new side-by-side electronic and open-outcry system, traders said.
"Origin was seen at the higher end of the range which capped off the top end," one trader said, adding spreading contributed to the session's volume. Nybot benchmark March contract dropped 0.40 cent to $1.1835 per lb, in dealings from $1.1775 to $1.1940. May fell 0.35 cent to $1.2140 and traded from $1.2080 to $1.2220 while the rest settled 0.25 to 0.40 lower with the exception of one contract.
The March contract broke through Thursday's high but a lack of follow-through buying caused locals to liquidate, traders said. The electronic March coffee futures contract sat at $1.1840 per lb, while May was at $1.2130 at 1:58 pm.
"I think the system showed that it can work. We'll see where the liquidity is. The traders will go to where the most liquid market is and presently it's still on the floor," a dealer said. Final open-outcry coffee volume was estimated by Nybot at 17,331 lots, compared to the 26,057 officially tallied on Thursday, when open interest fell by 88 to 133,244 lots. Nybot estimated an additional 3,651 lots were traded electronically ahead of the e-trade close, excluding spread trades. Nybot estimated pit-traded options calls volume on Friday at 6,036 and puts at 3,406.
Robusta coffee futures in London turned lower just ahead of the close on speculative position-covering and on New York's weakness, dealers said. Liffe's spot March contract dropped $8 per tonne at $1,595 per tonne, trading from $1,589 to $1,614. May dropped $4 to $1,589, in dealings from $1,584 to $1,605 while the rest settled from $6 lower to $11 higher.
For industry news, Europe's physical coffee market again saw active business in Vietnamese new crop robusta this week while Brazilian arabica business was restrained by firm differentials, traders said on Friday.
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