Optimistic stock markets helped pull the commodity trade upwards as investors left the haven of the dollar, venturing into riskier assets. On the ICE, Coffee “C” futures for September delivery gained 1.35 percent to $1.5945 per pound, while cocoa futures for the same month dropped .72 percent to
$2,914 per metric ton after an early rise.
The increase in coffee prices was the biggest in two weeks. The price of beans spent the last month July wavering around the $1.60 per pound mark after a huge spike in June. Concerns about disruptive weather in East Africa and Brazil have been a major factor over the last month of trading.
Cocoa futures have been at the center of the international news cycle lately, after the Armarjo trading house and hedge fund bought most of Europe’s existing stockpiles in a trading coup on the Liffe.
Marcio Bernardo, an analyst at Newedge USA, attributed the commodity gain to currency effects in an interview with Bloomberg News. “Strong equity markets and a weaker dollar are helping most commodities, including coffee. There is also some fund buying.”
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