Investing.com – Coffee futures declined for the first time in three days on Tuesday, pulling back from a one-month high as investors locked in profits following the previous session’s strong gains.
On the ICE Futures Exchange, Arabica coffee for December delivery traded at USD2.4803 a pound during U.S. morning trade, dropping 1.22%.
It earlier fell by as much as 2.99% to trade at a daily low of USD2.4360 a pound.
Coffee prices rallied nearly 8% since last Friday, including a 2% gain on Monday which took prices to USD2.5235 a pound, the highest since September 21.
Coffee’s gains came as heavy rains in South America and flooding in Thailand fuelled concerns over dwindling global coffee supplies.
However, the rally prompted some investors to sell their position on profit taking and lock in gains, as traders remained cautious ahead of Wednesday's critical European Union summit, which markets hope will result in a viable solution to the euro zone's debt crisis.
Earlier in the day, German Chancellor Angela Merkel said she remained opposed to the European Central Bank's policy of buying bonds in the secondary market.
Adding to investors’ nervousness, a meeting of EU finance ministers scheduled to take place ahead of the EU leaders summit has been cancelled according to reports.
Coffee futures remained supported after Colombia’s National Federation of Coffee Growers said in a report released earlier that the country may produce its smallest crop in two years in the 2011-12 marketing season, due to excess rain.
According to the group, coffee production in Colombia was forecast to total 8.5 million bags this year. In August, the Federation cut its forecast to 9 million bags, from 9.5 million previously. Last year’s crop was 8.9 million bags.
In September, production fell 13% to 459,000 bags, the smallest monthly amount in more than two years.
Colombia is the world’s second largest producer of Arabica coffee beans.
Elsewhere, on the ICE Futures Exchange, cotton futures for December delivery rose 0.43% to trade at USD 0.9836 a pound, while sugar futures for March delivery shed 0.55% to trade at USD0.2700 a pound.
On the ICE Futures Exchange, Arabica coffee for December delivery traded at USD2.4803 a pound during U.S. morning trade, dropping 1.22%.
It earlier fell by as much as 2.99% to trade at a daily low of USD2.4360 a pound.
Coffee prices rallied nearly 8% since last Friday, including a 2% gain on Monday which took prices to USD2.5235 a pound, the highest since September 21.
Coffee’s gains came as heavy rains in South America and flooding in Thailand fuelled concerns over dwindling global coffee supplies.
However, the rally prompted some investors to sell their position on profit taking and lock in gains, as traders remained cautious ahead of Wednesday's critical European Union summit, which markets hope will result in a viable solution to the euro zone's debt crisis.
Earlier in the day, German Chancellor Angela Merkel said she remained opposed to the European Central Bank's policy of buying bonds in the secondary market.
Adding to investors’ nervousness, a meeting of EU finance ministers scheduled to take place ahead of the EU leaders summit has been cancelled according to reports.
Coffee futures remained supported after Colombia’s National Federation of Coffee Growers said in a report released earlier that the country may produce its smallest crop in two years in the 2011-12 marketing season, due to excess rain.
According to the group, coffee production in Colombia was forecast to total 8.5 million bags this year. In August, the Federation cut its forecast to 9 million bags, from 9.5 million previously. Last year’s crop was 8.9 million bags.
In September, production fell 13% to 459,000 bags, the smallest monthly amount in more than two years.
Colombia is the world’s second largest producer of Arabica coffee beans.
Elsewhere, on the ICE Futures Exchange, cotton futures for December delivery rose 0.43% to trade at USD 0.9836 a pound, while sugar futures for March delivery shed 0.55% to trade at USD0.2700 a pound.