LONDON/SAO PAULO (Reuters) – Brazil is producing less top quality coffee this year despite a bumper crop overall because of unusual pre-harvest weather, burning some traders counting on the beans, said industry sources.
The market for Brazilian fine cup arabicas is tighter than normal, causing a premium for the origin over New York futures, which is particularly rare this time of the year, said traders, who requested anonymity to discuss the market-sensitive matter.
“Some trade houses are scavenging the market. Those coffees are trading at a premium to New York and it’s only July. It’s going to be a long, painful season for these folks,” said a London-based trader.