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Robusta coffee gains in thin trade

LONDON: ICE robusta coffee futures rose on Friday, boosted in thin trade by a more upbeat mood in broader markets.

* March robusta coffee was up $10, or 0.7 percent, at $1,518 a tonne by 1420 GMT, after climbing to a session high of $1,527.

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* Dealers noted prices were edging higher in step with broader commodity and equity markets, although traded volumes remained thin.

* “We’re just following the macro at the moment,” one European dealer said.

* Gains were capped, however, by the threat of hedging by producers in top grower Vietnam, which is currently harvesting a massive crop.

* “Expectations are still for a surplus in both robusta and arabica,” the dealer said.

* March arabica coffee fell 0.35 cent, or 0.3 percent, to $1.0140 cents per lb but remained above a three-month low of 98.60 cents set last week.

* The market attempted gains in earlier trade, boosted by a rally in the Brazilian real, but buying faltered as the currency softened.

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* A stronger real discourages producer selling by reducing local returns on dollar-traded commodities like coffee and sugar.

* Fundamentally, the focus remained on ample supplies.

* “Central America needs to sell into the New York market,” the dealer said. “(It’s) probably going to run into some origin selling.”

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Source:Copyright Reuters, 2018

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