Coffee futures continued to perform well in the commodity market, stretching its week-long climb, as it finished in the record territory on Wednesday trading amid producers’ extended hiatus to sell.
As traders feasted on technical signals that the coffee market is oversold, Arabica coffee futures contract for September delivery ended at its highest settlement in more than three months at $1.4035 per pound on a 2.5 cent gain from a 1.8% surge in the ICE Futures US exchange.
The latest close was the best finish for the contract since April 19.
The commodity has been enjoying a buoyant week as momentum from last week’s surge has been sustained. This helped the contract touched the 200-day moving average of $1.40, but still lacks the needed push to move past the said level.
Meanwhile, robusta coffee futures for September delivery grabbed $35, or 1.7%, to settle at $2 145 per ton.
According to coffee broker from Cazarini Trading Co. in Brazil, a series of technical adjustments have helped commodity prices drove to its current level despite coffee not being the big thing and not rising much higher.
Producers in Brazil, the largest producer of coffer in the world, went on a sale hiatus as they await coffee prices to break the current 500 reais level before they go back selling.
The oversold in the coffee market was brought by heavy exports and huge sales book in the previous year but has made trading comfortable.