Coffee futures continue to find lower lows as officials in Brazil are encouraged by favorable weather in the top arabica-coffee growing regions and claiming they can see coffee output spike to up to 58% – a record high. Coffee futures are up .025 cents today (after finding a new contract low only yesterday) and currently trading just above $1.14 per pound at the Intercontinental Exchange based in Atlanta.
Brazil’s top agriculture bureau has reportedly estimated this year’s coffee harvest to be between 49.1-51.9 million bags which could potentially top the record 50.8M bags realized in 2012. The worst coffee production estimate still comes in near the second best harvest only three years ago before the drought conditions appeared in early 2014.
“Brazil is in the midst of a sharp rebound in coffee production thanks to the favorable weather in their top-producing growing regions,” said Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, sharing his fundamental assessment of the coffee futures market. Plotkin added, “The country is reasserting their dominance as the world’s top coffee producing country after a dismal 2015.”
The trend in coffee futures is down with no bottom yet in sight. It will take much fundamental change for coffee futures to turn things around, but a major plus in keeping prices low for coffee enthusiasts all over the world.
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