Brisk trade was also reported in cheap Ethiopian beans,
with Djimmah Grade 5 offered well below Central and South American supplies at
24 cents under New York. "I think the roaster interest was focused on the
attractively priced sundrieds from Ethiopia," one broker commented.
April 27, 2012
HAMBURG, April 27
(Reuters) - Europe's cash coffee market saw roaster purchase interest in
Brazilian beans this week with talk some major multi-national groups were
seeking Brazilian supplies, traders said on Friday.
"I had good
European roaster buying interest in Brazilian arabicas for the second half of
this year and the first quarter of 2013," one trader said. "There was
talk the favourable market configuration generated some hefty buying interest
among some of the big multi-national roasters but it is always difficult to
nail down if the multi-nationals have actually bought."
Traders said a
combination of low arabica futures,
attractive price differentials and strong selling by Brazilian exporters helped
generate European purchase interest.
New York futures
slumped to 18-month lows on Apr. 16 as the looming large Brazilian crop weighed
on the market. But New York futures rose above the lows this week, helping to
generate origin selling along with a weak Brazilian currency.
"Brazilian
differentials were a tick firmer this week but are still at discounts to New
York which is interesting to roasters," another trader said.
Brazil MTGBF beans
were quoted at 7 cents under New York nearby futures contracts <0#KC:>
against 10 cents under last week. Earlier in the month they had been at level
New York.
"Some lower
Brazilian new crop offers were appearing this week and finding ready buyers
from European roasters who have been waiting for differentials to turn their
way," a trader said.
Differentials for
Colombia Excelso beans fell to 28 cents over nearby New York against 30 cents
over last week as the weather improved, bringing some hope for a better crop.
Colombia, the world's
top producer of high-quality arabica beans, in 2011 posted a third consecutive
year of low coffee output because of bad weather, plant fungus and a tree
renovation programme. Its March exports were also sharply down.
The lower Colombian
differentials helped generate some purchase interest for shipment ranging from
spot to the end of 2012.
Dealing in Central
American beans is generally being run down as regional harvests come to an end.
But larger than expected sales offers weakened Honduras differentials, with Honduras
HG offered down 1 cent on the week at 6 cents under New York. Traders also
noted larger than expected sales flows from Guatemala.
Brisk trade was also
reported in cheap Ethiopian beans, with Djimmah Grade 5 offered well below
Central and South American supplies at 24 cents under New York. "I think
the roaster interest was focused on the attractively priced sundrieds from
Ethiopia," one broker commented.
In robustas, traders
reported moderate business in Vietnamese beans for mid-year delivery positions
at slightly softer differentials.
Vietnam Grade 2
robusta was quoted on Friday at $20 under nearby London robusta contracts
<0#LRC:> against $10 under last week.
"We are seeing
very strong export shipments from Vietnam which is helping to weaken differentials
with the April shipments alone expected to be up 18 percent," a trader
said. "But it is hard to get Vietnamese sales offers for anything other
than immediate shipment."
Differentials from
rival robusta Indonesia were also softer, falling to $80 over
London from $90 over last week.
"A better crop
means Indonesian beans are now off their crisis differentials of $500 over
London late last year but their own coffee industry is still taking a lot of
the country's production which made trade tough this week," a dealer said.
---
Reporting by Michael Hogan;
editing by James Jukwey