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CSCE coffee futures down

NEW YORK: CSCE coffee futures slipped back marginally on Friday, managing to cling on just above a key support level, with light industry buying at the lows and an absence of origin selling, traders and brokers said.

"Most of the volume came from switches, but it was pretty dead really. I still feel that the market is under pressure," one Miami-based broker said. Key March arabica fell 0.80 cent to 111.20 cents a lb, trading 113.50-110.80 cents

May shed 0.70 cent to close at 114.20 cents a lb, whilst back months lost between 0.70-0.85 cent.

Key March arabicas opened just 0.25 cent higher, failing to meet earlier calls of a 2.00 cent rise, coming under further pressure from speculative and local selling, brokers said. But continuing support from industry allowed prices to hold above 110 cents, a key level under which funds are rumoured to be ready to liquidate their three-month old, net long position.

"I think if it breaks through that 110-109.50 level then the funds will come in and do some selling, but right now they're still holding on tight," the broker said.

Large investment funds, or non-commercials were shown holding a net long position of 9,672 lots as of Jan. 11, according to the last CFTC Commitments of Traders report.

Smaller speculators were also net long 3,202 lots. In fundamental news, Colombia's coffee stocks dropped 50 percent in 1999 to an 18-year old low of just 2.3 million (60-kg) bags, the National Coffee Growers' Federation said Friday.

A federation official said existing stocks, at the end of December and discounting freshly harvested beans, were barely enough to cover Colombia's export commitments and internal demand for three months. Technicians said that resistance for key March contract was around 118-120 cents. Support was pegged at 110-109 cents.

Volume traded reached an estimated 8,358 lots on Friday, against Thursday's official volume of 11,822 lots previously.

Call volume reached an estimated 1,447 lots, whilst puts were seen at 1,464 lots. The CSCE is a subsidiary of the New York Board of Trade.-Reuters