Poor Farmer

Reuters San Salvador October 31, 2011 Oct 31 (Reuters) - El Salvador on Monday cut its forecast for growth this year to 1.4 percent from 2.1 percent due to heavy rains that damaged coffee crops in the Central American exporter. Strong storms hit southern   Mexico, Salvador and the rest of Central America for nearly two weeks earlier this month, killing around 130 people and displacing thousands. Central America together with Mexico grows more than one-fifth of the world's arabica coffee. The rains took a $150 million toll on the country in terms of damage to housing, roads and agriculture, said Alex Segovia from the president's office. "The biggest impact is on agriculture," he told reporters at a press conference on Monday. Procafe, the country's coffee association, cut its estimate for coffee production in 2011/12 crop to 1.33 million bags (60-kg bags) earlier this month, from the previous 1.41 million bags due to rain damage. The...

By Marvin G. Perez Bloomberg October 31, 2011 Oct. 31 (Bloomberg) -- Inventories of arabica coffee held in warehouses monitoried by IntercontinentalExchange Inc. tumbled 11 percent in October from September, the biggest decline since 1998, according to data from the exchange. Stockpiles plunged to 1.267 million bags, the lowest since 2000 and down 30 percent from 1.817 million bags held a year earlier, data from the Atlanta-based exchange show. A bag weighs 60 kilograms, or 132 pounds. ---  Related story… ICE Arabica Coffee Futures Plunge By 5% The Wall Street Journal October 25, 2011 NEW YORK (Dow Jones)--Arabica coffee futures plummeted 5% Tuesday, as investors cashed in on a rally fueled by concerns that flooding in Colombia and Central America would hurt supplies of quality coffee this season. At 11:55 a.m. EDT, arabica coffee for December delivery was trading at $2.3840 a pound, down 5% on the day. "I think it's more liquidati...

By Marvin G. Perez Bloomberg October 31, 2011 Coffee fell to a two-week low as concern mounted that Europe will fail to contain the region’s debt crisis, while the dollar’s rally eroded the appeal of commodities. Sugar and cocoa also declined. The greenback jumped as much as 1.9 percent against a basket of six currencies after Japan took steps to weaken the yen. Global equities tumbled as investors awaited details from European leaders on funding the expanded bailout. The Standard & Poor’s GSCI index of 24 raw materials fell as much as 1.7 percent. “There are new worries about Europe,” Sterling Smith, a commodity analyst at Country Hedging in St. Paul, Minnesota, said in a telephone interview. “The dollar got stronger, and suddenly, there’s a drop in risk appetite. Fundamentals are being put on the shelf. People are stepping to the sidelines.” Arabica coffee for December delivery dropped 3.5 percent to $2.2695 a pound at 2 p.m. on ICE Futures U.S. in New Yo...