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CSCE coffee stagnates, ends mostly higher

NEW YORK: coffee futures saw sideways trading within a tight price band on Tuesday, settling marginally higher for the most part.

"It was not a very exciting day. It was pretty much the same concept as (Monday). There's a lot of switch activity going on. But the market's still very, very weak," one Miami-based broker said.

May arabica closed unchanged at 96.65 cents a lb, trading 97.25-96 cents.

July crept up 0.15 to 99.65 cents, and the rest gained from 0.10-0.90 cents at the close of business.

Arabica prices defied pre-open expectations to come in firmer, falling slightly at the opening bell on some trade selling, floor sources said.

"We came in a little lower on trade selling and the specs (speculators) followed after that and got it down to 600 (96.00 cents)," one floor trader said.

Traders said that the market was at a virtual standstill, as operators concentrated on switch activity ahead of spot March's first notice day on April 19.

"The specs (speculators) and funds are just standing by. Nobody's really doing anything. It's the locals who are trading the market. (It's) really going anywhere right now," one floor dealer said.

Market talk that the monthly Green Coffee Association (GCA) coffee stocks report, due out on Monday, will show another increase of from 400,000-500,000 60-kg bags put pressure on futures, dealers said.

In fundamental news, Central American coffee producer Honduras lowered its forecast for exports in the current 1999/2000 cycle, an industry official said Tuesday.

He said that the present outlook for exports was 3.2 million (46-kg bags), compared to previous expectations of 3.4 million bags from a production of 4.0 million.

Brazil exported 1.118 million 60-kg bags of green coffee in march, down sharply from last March's 2.086 million bags, Council of Green Coffee Exporters of Brazil (Cecafe) said Tuesday.

On a technical basis, traders said May arabica should see support at the gap between 93.50 and 90.50. Resistance would be at 100 cents.

Volume traded reached an estimated 10,376 lots, compared with the previous official volume of 14,273 lots. Call volume totalled 2,130, whilst puts were estimated at 485 lots.

The CSCE is a subsidiary of the New York Board of Trade.-Reuters