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CSCE coffee finishes shade up, eyes on ACPC

NEW YORK: CSCE coffee futures closed marginally firmer Friday due to a late burst of speculative and local buying although most of the trade sat back in front of crucial coffee producers' meetings starting next week.

Mike Pucciarelli of Wechsler Coffee said trading for the past week has been practically at a standstill.

"The whole week was like that," he said.

May arabica settled at 103.70 cents a lb, 0.20 cent firmer, after trading 104.60-102 cents.

Second-month July rose 0.25 to 106.30 cents and September gained the same to 108.95 cents. The rest rose 0.15 cent.

Arabica prices headed north shortly after the opening because of light fund buying, but any further advance was stopped cold when origin pressure kicked in above 104 cents, basis May, brokers said.

"Mexico, particularly, started selling it," one said, adding other Central American origins were not too far behind.

The pressure drove coffee down to its lows where it snapped back late in the session on local and speculative buying, dealers said.

But volume was modest, mainly because several players were sidelined waiting for the meeting of the Association of Coffee Producing Countries (ACPC) in London on April 4-5 to take up a retention plan aimed at shoring up coffee futures.

In a parallel meeting on April 5, coffee producers from Central America, Mexico, Colombia, Brazil and the Dominican Republic will also meet in Costa Rica.

One senior broker said the ACPC may come up with a plan to withhold supplies from the market whose purpose would be to give futures a boost.

"Brazil never plays by the rules. Even if they come up with some kind of plan, it will probably fall apart later on," the broker said.

With the onset of the frost season in leading grower Brazil coming up at the end of May, the focus will turn away from the retention plan and "people will just forget about it," he added.

On a technical basis, traders said May arabica should see support at 100.25, followed by the psychological level of 100 cents, then the recent low of 98.40 cents. Resistance would be at 107, then 109-110 cents.

Volume reached an estimated 7,658 lots, against the official previous volume of 4,529 lots.

Call volume reached an estimated 2,397 lots, whilst puts were seen at 930 lots.

The CSCE is a subsidiary of the New York Board of Trade. -Reuters