Arabica coffee hits 7-month high on cold outlook in Brazil

Arabica coffee futures rose to a seven-month high on Monday, supported by concerns that a cold snap in Brazil later this week could pose a threat to crops in the world’s top producer.

September arabica coffee rose 4.0 cents, or 3.65pc, to $1.1345 per lb by 1328 GMT, after rising to a seven-month peak of $1.1410.

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Dealers said the latest forecasts for coffee-growing regions in Brazil indicated lower than previously expected temperatures during a cold snap from Friday through Sunday.

They noted it did not yet appear likely to be cold enough to do significant damage to crops but that there were sufficient concerns to prompt short covering.

The recent strong performance had also created a bullish outlook on price charts while further support came from a more positive mood in broader economic markets linked to news that the United States and China had agreed to restart trade talks.

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Robusta coffee prices were dragged higher by the strength of the arabica market.

September robusta coffee rose $36, or 2.5pc, to $1,487 a tonne.

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