Coffee prices likely won’t revisit May’s 20-year highs in the months ahead as stockpiles grow and concern eases that a winter frost will damage crops in Brazil.
The Brazilian Center for Weather Analysis and Forecasts predicted Tuesday that growing regions in Brazil, the world’s largest coffee producer, will remain frost-free.
The forecast caused coffee for September delivery on New York’s Coffee, Sugar & Cocoa Exchange to slid 4.15 cents to $1.5785 a pound Tuesday, the lowest price since February 7.
Coffee futures surged in May on speculation that a repeat of 1994’s damaging frost in Brazil would send U.S. stockpiles, already depleted, to dangerously low levels next year. The soaring futures sparked a wave of retail price increases by Starbucks Corp., Procter & Gamble Co.’s Folgers coffee and others.
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