(Reuters) -Coffee prices edged lower on Friday after hitting their highest level in almost half a century during the session. They were boosted by tighter supplies as next year’s crop in top producer Brazil struggles to fully recover from this year’s drought.
Dealers also said some Brazilian farmers had delayed deliveries of this year’s crop in the hope of securing even higher prices, leading to a short-term supply crunch and major financial losses for traders who had expected the coffee to receive.
Arabica coffee futures on the ICE exchange fell 1.5% to settle at $3.1805 per pound, after hitting their highest since 1977 at $3.3545.
Arabica coffee prices have now risen by around 71% this year, making it one of the best performing commodities alongside cocoa, whose prices have more than doubled.
“The price development is now very similar to that of cocoa at the beginning of the year. The reasons are also similar,” Commerzbank (ETR:) said in a note on Friday.
“In the case of cocoa, there were poor harvests in the two main production countries, Ivory Coast and Ghana. In the case of arabica coffee, the concern is that Brazil, the main producing country, will have a bad harvest next year. to drought.”
Brazilian coffee traders Atlantica and Cafebras said on Wednesday they will negotiate with their creditors in court, noting that 900,000 60kg bags of coffee promised by farmers have not been received.
The price of Robusta coffee, a cheaper bean often used in instant coffee, also rose to its highest point in about 47 years on Friday.
Robusta coffee futures on ICE peaked at $5,694 a tonne on Friday before falling to settle 2.7% at $5,377.
New York cocoa futures on ICE settled 3.9% higher at $9,425 a tonne, after hitting a five-month high of $9,520.
Cocoa prices rose to a record high of $11,722 per tonne in April, with supply tightening due to poor harvests in top producers Ivory Coast and Ghana.
Futures on ICE settled 1.3% higher at 7,708 pounds per tonne, after a five-month high of 7,772 pounds.
Sugar prices, meanwhile, fell, with March raw sugar down 2.8% on the session to 21.08 cents per pound, while March white sugar lost 1.5% to $547.70 per tonne.
