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CSCE cofee plummets

NEW YORK: CSCE coffee settled sharply lower across-the-board Tuesday in a technical correction following Monday's rally to seven-month highs, traders said.

Most-active July closed 4.05 cents lower at 126.90 cents a lb, ranging between 130.50 and 126.65. Spot May settled down 3.20 at 127.05 cents and September was off 3.40 at 125.70, while the remaining months ended 3.95 to 5.90 cents lower.

The market was called to open 3.00 to 4.00 cents lower, but follow through speculative buying initially supported prices, dealers said, but trade selling pressured prices.

Despite today's losses, one analyst said many of the market's fundamentals were constructive.

"We have less exports from Brazil and consumption didn't go down as much as people anticipated," the analyst said, adding that this was reflected in low stock levels.

Consumer stocks of green coffee, now near 15-year lows at some 8.0 million bags, provided support, he said, as did U.S. certified coffee stocks data released Monday, which reported that stocks fell 22,336 60-kg bags in the week ended April 19 to 97,984 bags.

Brazil's approaching winter will also lend support to prices, although the earliest frost ever was recorded in late May.

But dealers and analysts said speculators were long and could make the market subject to a lot of volatility.

Volume reached an estimated 11,000 lots, compared to Monday's official volume of 13,843 lots.-Reuter