Fund Buying Lifts Coffee Futures

Fund buying helped nearby LIFFE coffee futures to jump after a weak start, traders said.

Short covering by roasters also helped to support prices, they said.

By the end of the morning session, March, which has dominated volume, was approaching resistance at $1,350. It last traded 15 higher at $1,346, having seen a high of $1,347 during the later part of the session, March volume was 1,722 lots, of a total of 3,181 lots.

March's low of the morning was $1,310.

November 1997 and January 1998 missed the rise, with falls of $6 for November and $5 for January, in small volume for both months.

 

"Roasters now run a more just-in-time policy on buying than they have done in past years," one trader explained. This means that they have to buy more quickly than once would have been the case. At the moment the roasters are having to bring their buying to the market, he said.

Fresh highs on Thursday in New York, which shrugged off bearish news to end slightly higher on chart-driven dealings, have helped contribute a bullish tone to the market, traders said.

Colombian workers have rejected a preliminary accord and voted to continue their strike at the Pacific coast port of

Buenaventura, port authorities said on Thursday. The strike has caused chaos with Colombian coffee exports, more than 60 pct of which are shipped through the port.