A forecaster in Brazil says that coffee crops across the southeastern Brazilian states of Sao Paulo and Minas Gerais will get rain during the next few days, while hailstorms look unlikely.
Expedito Rebello, the head of research at the government-led Meteorology Institute, told Bloomberg News that "the rains will help the coffee harvest after all these months of drought. The weather will be very good for the flowering of coffee trees from now on."
The two states grow 85 percent of Brazil's coffee crop. The country is the largest grower and exporter of coffee in the world, so its weather patterns tend to be closely followed by commodity futures brokers and traders.
Yet despite the positive signs for the crop, coffee futures surged in trading today, as the dollar fell against a basket of currencies. On the IntercontinentalExchange, Coffee "C" futures for March 2011 delivery climbed 3.363 percent to 190.25 cents per pound.
In the U.K., arabica coffee futures on the Liffe jumped nearly 4 percent to 189.35 cents per pound the beans are up nearly 50 percent in the last year.
It's unclear what's driving the current surge in coffee, though it may be based on technical buying and the absence of harvest forecasts from Vietnam, says Bloomberg.
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