Weather Scare Extends Coffee Futures Gains

Coffee futures blasted-off early in Tuesday’s trading session when it was estimated a whopping 10% of Brazil’s coffee crop may be lost due to lack of rain.  Coffee futures are already up 21% this month alone with the driest rainy season in over 20 years and a heat wave, has had its toll on Brazil’s agriculture.

The estimation of a 10% loss of Brazil’s coffee crop comes from an export manager at that country’s second largest coffee exporter.  To make matters worst, the forecast for rain in Brazil’s coffee growing region is to be below average.

Laura Taylor, a senior commodities broker at RJO Futures in Chicago trading coffee with me, had this to say regarding the current coffee futures situation,For the next two to three weeks commodity traders may find the coffee market to be in a choppy, sideways trend awaiting the next crop survey to see what the exact damage is.”

The trend for coffee futures is UP – with no top yet in sight.  We just exited our long coffee futures position (initiated late last week) early this morning before many of us even awoke.  This is why I have the BEST BROKER TEAM and PLAN OF ACTION each time we participate in these commodity markets – to anticipate these moves.

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