US arabica coffee inched to a weak close for the sixth straight day on Wednesday, pressured by fund and origin selling in a rangebound session following on Tuesday's fresh six-month low, traders said.
"I think there's a turning point somehow in the near future, but it's tough to say if we're going to dip first to $1.05, $1.03 July basis, or if we're going to work higher from here," said Rodrigo Costa, vice-president, institutional sales for Fimat USA in New York.
The NYBOT open-outcry benchmark July eased 0.40 cent lower to $1.0725, ranging from $1.0710 to $1.0790, while September fell the same to $1.1010. One contracts aside, the rest ended from 0.25 to 0.40 cent lower.
Roaster buying on the session lows prevented deeper losses, traders said. On the ICE New York Board of Trade electronic platform at 1:56 pm EDT (1756 GMT), the July contract slid 0.15 cent to $1.0750, while the rest ranged from 0.30 lower to 0.15 higher. Robusta coffee futures in London also finished mildly lower with Life's benchmark July ending down $3 at $1,571 per tonne, moving from $1,555 to $1,584.
"If there is any selling to be done by origin, it's going to be seen until on Friday and then after that I think it's going to be pretty much absent," Costa said. Brazilian coffee farmers will have to pay a government loan on Friday, and some will need to sell their coffee to pay this off, Costa said.
"The charts have been very disappointing since they broke out to the upside and there was no follow-through last week but you wonder how much further the sell-off can go with frost season not that far away," one broker said. NYBOT estimated 2,881 lots traded in open-outcry, compared with the total 23,511 contracts that were tallied on Tuesday, when 19,230 of the contracts traded electronically.
Weather, top coffee producer Brazil will see mostly dry conditions or a few lights showers amid near to above normal temperatures, DTN Meteorlogix said. Brazil's 2007/08-coffee crop, which is in the initial stages of harvest, should reach 35.5 million 60-kg bags, down from the 48 million bags harvested last season, traders Comex said on Tuesday.
Vietnam's coffee exports in the first seven months of the current crop year would jump 58 percent compared with a year to 14.67 million bags, the government said on Wednesday. Vietnam is the world's No 1 robusta coffee grower.
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