COFFEE FUTURES HIT 2-YEAR HIGH.
Byline: Hillary Chura Associated Press Associated Press: see news agency.
Associated Press (AP)
Cooperative news agency, the oldest and largest in the U.S. and long the largest in the world.
Coffee futures prices Futures price
The price at which parties to a futures contract agree to transact upon the settlement date. jumped to the highest point in almost two years Monday on weather woes as well as worries that a strike will paralyze par·a·lyze
To affect with paralysis; cause to be paralytic. shipping from Colombia.
Coffee prices have not been this high since May 1995. The gain was the largest one-day jump in 10 months.
Investors fear a nationwide strike in Colombia - the world's second top coffee producer and exporter - will delay coffee shipments, said analyst Walter Spilka at Smith Barney Smith Barney is a division of Citigroup Global Capital Markets Inc., a global, full-service financial firm, that provides brokerage, investment banking and asset management services to corporations, governments and individuals around the world. Inc.
Hundreds of thousands of workers, including truck drivers who bring coffee to ports, were expected to protest for higher wages beginning today. Talks broke down Sunday.
Contributing to the Colombian concerns were growers who refuse to pick supplies until they receive higher prices.
Investors also worry that the Brazilian coffee crop - the largest in the world - will be about 11 percent lower than a year ago. The drop may come because coffee trees are in a cyclic lull after last year's good harvest.
Weather added to the fears, as the worst rains Bolivia has seen in 30 years were expected to move into Colombia's coffee regions.
Traders also responded to rumors that much of the coffee from Central America Central America, narrow, southernmost region (c.202,200 sq mi/523,698 sq km) of North America, linked to South America at Colombia. It separates the Caribbean from the Pacific. already has been sold before it is available, said analyst Arthur Stevenson at Prudential Securities in New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of .
The International Coffee Organization warned last week that a serious coffee shortfall is looming. World demand has exceeded production since 1993 amid rising consumption, but that has been addressed up to now by dipping into storage, the industry group said.
Annual production once represented 74 percent of consumption, but dropped to 47 percent in the past year. That number is expected to fall even further if Brazil posts a 20 million bag harvest or less, as many are predicting.
The situation has caused coffee prices to soar about 50 percent in fewer than two months as roasters compete with speculators for quality stocks.
Coffee for March delivery rose 7.6 cents to $1.587 a pound on the New York Coffee, Sugar and Cocoa Exchange The Coffee, Sugar and Cocoa Exchange (CSCE) founded in 1882 as the Coffee Exchange in the City of New York. Sugar futures were added in 1914, and in 1979 the Coffee and Sugar Exchange merged with the New York Cocoa Exchange, which was founded in 1925. . May's gain was 8.45 cents and July's was 7.4 cents.