New York arabica coffee futures finished with only small losses on Friday traders said, but earlier follow-through fund selling sent prices down to levels unseen since early November 2004.
Benchmark September coffee gapped lower at the open as players in New York caught up to steep declines in the London coffee market, but then some roasters came in to buy at the lows. London traders had been reacting to New York's weak close on Thursday, when arabica prices broke a key technical support level at a 21-month low.
"More fund selling. We saw some at the beginning of the session, but there was not as strong follow-through selling as one would have thought. We did trade lower, but then hovered around the lows from yesterday," said one coffee dealer.
New York Board of Trade arabica coffee for September delivery settled 0.20 cent lower at 95.60 cents a lb, after breaking down to early November, 2004 levels. All other arabica coffee futures set new life-of-contract lows on Thursday, and closed with 0.20 to 0.30 cent losses.
With no change in coffee fundamentals, traders said technical factors were driving the market in recent sessions, and weak signals should pressure coffee further on Monday.
"On the weekly chart, it looks like there will be more follow-through selling on Monday, especially with London closing at its lows. And, technically we're still very weak," a coffee trader said.