US arabica coffee futures inched lower on Friday as a continued lack of fresh fundamentals kept dealings in another rangebound session, while light origin selling added some pressure, traders said. "There's nothing new to help the market. We are just in front of the Brazil harvest. Funds are short already, they could get shorter," a broker said.
NYBOT open-outcry benchmark July fell 0.85 cent to settle at $1.0570 per lb, moving from $1.0500 to $1.0660. September slipped 0.90 to $1.0850 while the rest ranged from 0.70 to 0.90 cent lower. "It seems like, fundamentally speaking, it's kind of low to be trading down here before we start a deficit year," the broker said.
The most recent official 2007/08 (July/June) coffee crop estimate for top coffee grower Brazil was projected by its agriculture ministry at 32.1 million 60-kg bags, down from 42.5 million bags produced this season. On the IntercontinentalExchange New York Board of Trade electronic platform at 2:00 pm EDT (1800 GMT), July edged down 0.80 cent to $1.0575.
The second month contract fell 11 percent from its highest trade in mid-April to the lowest on May 1, after which it rose modestly and settled into a sideways trend.
The benchmark July contract will need to settle above the key level $1.0750 to trigger a correction higher, one trader said. The next levels of support were pegged at $1.05 and then $1.0325. NYBOT estimated 2,234 lots traded in open-outcry, compared with the total 14,289 contracts on Thursday, when 9,359 contracts traded electronically.
Options calls volume was estimated at 5,073 lots with puts at 7,252 lots. Robusta coffee futures in London closed slightly firmer, underpinned by continued roaster demand but capped by speculative profit-taking and light origin selling, dealers said. Liffe's benchmark July finished $4 firmer at $1,651 a tonne after trading $1,632 to $1,655.
Overseas, coffee exporters in Kenya plan to keep in place until June a cap on auction volumes established after large offerings earlier in the year hit prices, the head of a producers and traders group said on Friday. For weather, the Brazilian coffee belt will be mostly dry amid cooler temperatures continuing through Sunday, with warmer weather to follow next week, DTN Meteorlogix predicted.