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FUTURES MARKETS – Arabica prices skyrocket to 32-month highs

MILAN – Arabica-futures rose to a 32-month high Monday on speculation that the lack of rains in the main coffee areas could affect the development of the 2015/2016 crop.
The most active contract for delivery in December settled up 6.9% at $2.2080 a pound, the highest level since February 2012 on the ICE Futures U.S. exchange. The contract rallied as much as 9.2% during the day reaching a new contract high at 225.50 basis spot December, which is the highest level for a most-active contract since January 20th, 2012.
Weather service Somar in Brazil extended the forecasted dry period in coffee zones until after October 16th.
Dry weather was forecast for the next 10 days also by Drew Lerner, the president of World Weather Inc. in Overland Park, Kansas.
“It’s a critical period for the Brazilian arabica crop, which is flowering,” Tracey Allen, an analyst at Rabobank International in London, said in an e-mail adding that “Meaningful rain has not yet been received.”
Since Monday 22nd September, Arabica prices have risen as much as 23% or a 4,140 point increase over the course of the last two weeks.