Arabica and robusta coffee prices in the domestic spot markets may move a shade lower in the week ahead on slack domestic demand, traders said. | |
| Export demand continues to be weak and offtake of coffee locally is seen down on the onset of summer in the country. On the New York Board of Trade, arabica for May delivery is likely to edge down on profit booking. May robusta on London International Financial Futures Exchange could also see a downward correction, mirroring trends on NYBOT. |
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| Arabica coffee prices are likely to move down Rs 2-3 a kg and robusta is seen down Rs 1-2 a kg this week, said P J Suresh Babu of Bangalore-based Chaitanya Coffee. |
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| "Domestic coffee prices have been ruling quite high. A correction is due. Also consumption of coffee falls by 10-15 per cent during summer months of April to June," he said. Another factor that will aid the downward trend is lack of export demand. India's coffee exports during January-March were down 33 per cent on year at 31,317 tonne. Domestic prices have been ruling higher over international prices resulting in low exports. |
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| "Arabica coffee prices in India are higher than those in Colombia and other countries," said an official at an international trading house. |
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| Growers and traders have been reluctant to release stocks keeping prices high. However, they are likely to liquidate stocks ahead of the four-month monsoon season. This week robusta cherry AB grade is likely to be in the range of Rs 67.00-68.50 a kg and arabica in a band of Rs 119-120 a kg. |
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| Global prices could see a downward trend this week on profit booking. Also, supply tightness scenario is easing, said Gnanasekar Thiagarajan, director, Commtrendz Risk Management Services. |
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| According to him, the frost factor also does not impact prices any more as coffee plantations in Brazil and Columbia have been shifted out of the areas susceptible to frost. |
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| LIFFE May contract is likely to hover in the range of $1,400-1,425 a tn this week he said. |
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| The contract had ended Thursday at $1,542 a tn ahead of the long weekend. Trading on LIFFE resumes today after Easter holidays. NYBOT May contract could lose 2-3 cents this week. On Monday, it ended at $1.0965 a pound. |
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| International markets are likely to be range-bound with a downward bias because of a typical lull in trading that follows Easter holidays in Western countries, said an analyst. |
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