What's this about coffee going up?

[wayneL]

According to NewsCorp Coffe beans are on the up.

A doubling of the price of raw coffee on international commodity markets is expected to drive up the cost within months and popular supermarket blends could cost up to 20 per cent more within the next year as local importers and roasters pass on the higher raw commodity price.

Instant coffee will feel the impact first, followed by gourmet or specialty blends and, eventually, major fresh coffee brands.

World prices have exploded in the past year due to poor harvests in Vietnam and growing demand from new consumers in India and China.

Well that's freakin' news to me. Check out the NYBOT coffee chart below (the first one) which happens to be arabica coffee (the good stuff)

Then I checked the LIFFE contract which is robusta coffee (the cheap stuff) and indeed it is on the up... but I didn't think anyone actually drank that robusta ####!

(I like my coffee ]

 

[professor_frink]

A doubling of the price of raw coffee on international commodity markets is expected to drive up the cost within months and popular supermarket blends could cost up to 20 per cent more within the next year as local importers and roasters pass on the higher raw commodity price.

Instant coffee will feel the impact first, followed by gourmet or specialty blends and, eventually, major fresh coffee brands.

World prices have exploded in the past year due to poor harvests in Vietnam and growing demand from new consumers in India and China.

NOOOOOOOOOOOOOOOOOOOOO!!!!!

This commodities boom thingy has now gone too far. I don't care if the Chinese and Indian folk want to push up the price of everything else, but making coffee more expensive is just not on.

The world better not start messing with my morning caffeine fix.

There'll be big trouble I tells ya :shoot:

 

[wayneL]

NOOOOOOOOOOOOOOOOOOOOO!!!!!

This commodities boom thingy has now gone too far. I don't care if the Chinese and Indian folk want to push up the price of everything else, but making coffee more expensive is just not on.

The world better not start messing with my morning caffeine fix.

There'll be big trouble I tells ya :shoot:

WE must bring about a devastating deflationary depression to stop this madness. I agree professor, messing with coffee is just sacrelige...IT'S NOT ON.

Anyway, it appears to have been even worse in times past. Check out this monthly chart (liffe continuous) and look at the price potential of this sucker. <start toungue in cheek> Let's hope Bush et al are coffee addicts as well as oil addicts. Surely they will invade Brazil, Columbia, New Guinea and Kenya to secure supply.

Hang on! That makes the price go UP! We're doomed </end toungue in cheek>

Cheers

 

[professor_frink]

It would be interesting to compare that coffee chart with murder rates during those price spikes

<start toungue in cheek> Let's hope Bush et al are coffee addicts as well as oil addicts. Surely they will invade Brazil, Columbia, New Guinea and Kenya to secure supply.

Hang on! That makes the price go UP! We're doomed </end toungue in cheek>

If it comes to that, I'll be in south america fighting the coffee stealing ******** with my Columbian brothers. And if we lose the war then I'll have to find a new stimulant to enjoy What other drugs to the Columbians make that I could take?

 

[wayneL]

It would be interesting to compare that coffee chart with murder rates during those price spikes



If it comes to that, I'll be in south america fighting the coffee stealing ******** with my Columbian brothers. And if we lose the war then I'll have to find a new stimulant to enjoy What other drugs to the Columbians make that I could take?

LOLOL

Something like this?:

 

[professor_frink]

that should do the trick.

 

[wayneL]

Oh My Gawd!!!!

Professor!! It seems there some funnymentals behind the coffe price scare.

I've been browsing Ebay for some jungle greens and an AK47.

Tu hablo Espaňol?

Next hot commodity? Arabica coffee beans

By CLAUDIA CARPENTER AND NGUYEN DIEU TU UYEN
BLOOMBERG NEWS

New York, home of the $4 cup of coffee, may be where the commodity gets its next price jolt.

Prices for arabica coffee beans on the New York Board of Trade could climb more than 20 percent in the next 12 months and outperform some of this year's best commodities investments, including copper and silver.

Demand for the beans is coming from Procter & Gamble Co., whose Folgers brand is the best-selling U.S. coffee, and Kraft Foods Inc., the maker of Maxwell House. Coffee sellers are turning to the arabica beans traded mostly in New York after a cheaper coffee variety called robusta rallied to a seven-year high in London last month.

"Now that robusta is moving up, it's bringing other grades into play," said Raymond Keane, a coffee trader in Charleston, S.C., for Balzac Bros. & Co., which supplies the commodity for Procter & Gamble and Kraft.

Coffee in New York may reach $1.30 a pound by the middle of next year, said Michael Coleman, managing director at Singapore-based Aisling Analytics, who helps run the Merchant Commodity Fund with $370 million. Arabica futures are little changed at about $1.08 this year, while robusta on the Euronext.liffe exchange in London jumped 30 percent.

The forecast for New York coffee compares with Macquarie Bank Ltd.'s prediction for a decline in copper, which jumped 75 percent this year. Silver, up 46 percent so far, will gain only 17 percent in 2007, Zurich, Switzerland-based analyst Edward Ennis at Julius Baer Holding AG forecast in July.

The International Coffee Organization forecasts a 2 percent rise in global coffee consumption to 7 million tons, helped by record growth at Seattle-based Starbucks Corp., the world's largest coffee-shop owner. Brazil, the world's biggest coffee producer, is unlikely in 2007 to repeat its bumper crop of 2.49 million tons this year, according to Conab, the forecasting agency for the nation's Agriculture Ministry.

About two-thirds of the world's coffee comes from arabica beans, which are used by coffee shops such as Starbucks. The rest is robusta, used in instant coffee, espresso and low-cost blends. Robusta beans give an espresso its froth, or "crema," and have about twice as much caffeine as arabica.

Coffee futures in London have risen in the past year as production from Vietnam, the largest robusta grower, declined because of a drought. Prices reached $1,586 a metric ton Aug. 22, the highest since 1999, after water damaged inventories in Italy.

advertising
Arabica prices haven't kept pace because Brazil this year is harvesting its second-biggest crop ever. Chances are Brazil's 2007 crop will decline because trees usually rest after a big harvest.

Dry weather is also hurting Brazil's plantations, and the flowering that starts in October will be damaged if there is no rain soon, hurting next year's crop.

Coffee roasters such as Cincinnati-based Procter & Gamble change the mix of bean varieties they use depending on price and consumer tastes.

"To the extent the ratio between the two contracts is way out of line, there must become a price point where arabica will become more viable than robusta," said Sean Corrigan, chief investment strategist at Diapason Commodities Ltd., which manages $5 billion of commodity investments.

The price spread between New York and London coffee is the narrowest in two years, boosting the appeal for buyers looking to use more of the mild-tasting beans. The premium for the most-active arabica contract is 38 cents a pound, down from 92 cents in March 2005, data compiled by Bloomberg show.

 

[professor_frink]

From my basic understanding of commodities, during a boom after the metals rally, eventually it was going to filter through to the soft commodities. I just never even thought about coffee

May be time to start trading coffee futures so I can offset the higher cost of my morning coffee

I've been browsing Ebay for some jungle greens and an AK47.

Very good. Let the training begin

 

[wayneL]

Could be a run up in coffee as weather risk in the growing areas is starting to be priced in.

Coffee futures have been quiet of late, as the market continues to digest the large exports out of Vietnam and Brazil, which are keeping current supplies ample. Heading into winter in the southern hemisphere, however, many traders are expecting Coffee prices to start pricing a "weather risk premium" into the market, especially with production expected to be light due the cyclical nature of Coffee. The International Coffee Organization has lowered its estimate for the 2006-07 crop to 120.5 million bags, down 1.5 million bags from the previous estimate. Consumption estimates were also raised to 120 million bags in 2007, up nearly 3 million bags. This puts great pressure on Brazil to have favorable weather conditions the next few months to prevent a possible supply deficit later this year.

1st chart is July Arabica
2nd chart is weekly continuous Arabica
3rd chart is July Robusta

 

[CanOz]

Unfortunately I've missed the opportunity this time on the Mini. Nice retracement and reversal.

 

[wayneL]

Unfortunately I've missed the opportunity this time on the Mini. Nice retracement and reversal.

Be happy, it just took a $30 hit on the NYBOT Arabica open (it was whacked 2% on opening)

 

[CanOz]

Be happy, it just took a $30 hit on the NYBOT Arabica open (it was whacked 2% on opening)

Yeah, wow, i've been away for a while and crude took a hit too, are these shakeouts Wayne?

Cheers,

 

[wayneL]

Yeah, wow, i've been away for a while and crude took a hit too, are these shakeouts Wayne?

Cheers,

Dunno, can't see any news in relation to these.

Monday opens