The Hindu Business Line : Coffee prices on the rise

THE coffee market, particularly that of Arabicas, continued to register a rise in price last month. But, according to the International Coffee Organisation (ICO), even this significant rise does not signal the end of the crisis caused by a protracted period of low prices.

The ICO composite indicator price for February rose to almost 60 cents per pound, representing an increase of 15.33 per cent compared to the average for calendar year 2003. In January, the price was 58.69 cents/lb and 52.44 cents/lb in December 2003.

On the New York futures market, the first position for C contract prices rose to a high of 75.05 cents/lb; however, this trend was not matched in the London futures market, where prices were around 35 cents/lb.

Latest estimates point to total production of 101.31 million bags during the crop year 2003-04, down 15.3 per cent from 119.61 million bags in the previous year. Arabicas suffered the most, with a cutback of 22 per cent in output resulting in 62.82 million bags in 2003-04 (80.54 million bags). Robusta output is estimated down by just 1.5 per cent to 38.49 million bags.

World consumption for calendar year 2003 was an estimated 111.5 million bags (109.3 million bags in 2002).

According to the ICO executive director, continuation of the present uptrend in prices will depend on the management of market supplies.