US arabica coffee futures ended firm on Tuesday, recouping on Monday's losses on support from fund short-covering and the firm London robust market, while light origin selling prevented stronger gains, traders said.
"A little bit of origin fixation's happening just above the market, that's holding the market from further rally," one dealer said. New York Board of Trade open-outcry benchmark July coffee rose 1.25 cents to finish at $1.1655 a lb., moving from $1.1550 to $1.1710. September futures ended up the same at $1.1935 a lb. while the rest finished from 1.25 to 1.40 cents higher.
On the ICE New York Board of Trade electronic platform at 2:01 pm, July coffee was up 1.40 cents at $1.1670 a lb. In London, robust coffee futures settled firm as the tight supply outlook was helped by a sharp bounce in the arabica market, dealers said.
The Liffe September coffee settled up $29 at $1,828, in wide dealings from $1,779 to $1,833, a fresh eight-year high on a second-month basis. "We need to have further non-commercial buyers come in to drive the market because they will be essentially the only buyers.
At some point, the funds will go from short to long and I believe that point to be somewhere in the vicinity of $1.2050," one United States broker said, about the July arabica contract. New York Board of Trade (NYBOT) estimated 5,928 lots traded in New York open-outcry, while traders pegged electronic volume at 15,098 at 1:16 pm EDT.
This compares to the 5,704 lots officially tallied in the pit on Monday, when 23,370 traded on the ICE electronic platform. Call options were estimated at 7,313 lots while puts were seen at 4,510 lots, on Tuesday.