MILAN – Arabica coffee futures in New York rose on Wednesday to their highest level in more than 6 years in response to a unusual cold snap that hit the Brazilian coffee belt. The more active contract for September delivery settled 920 points higher, up 5.5% from the previous day, to a fresh peak of $1.76 cents, its highest level since January 2015. September Robusta coffee closed $18 higher at a new contract high of $1,779.
The sudden frost happened in the morning of July 20. According to Brazil’s National Meteorology Institute (Inmet), temperatures fell as low as -1.2 Celsius (29 Fahrenheit) in Minas Gerais.
Farmers, brokers and analysts were assessing their crops on Wednesday after reports that the cold snap was much stronger than expected.
“Yesterday first impression was that the impact wasn’t as big” a leading coffee trader wrote yesterday in a report. “This frost was a little different as usually we have to have humidity for the leaves to burn. This time, temperatures were very low, below zero on most coffee areas and after the sun came up we started seeing the damage caused by the cold.”
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