Large Vietnam crop pressures robusta coffee

Robusta coffee fell yesterday, under pressure from an imminent large crop in Vietnam, while white sugar and cocoa were steady. US commodity markets were shut yesterday for Labour Day. Robusta coffee futures fell on small volumes of activity as top robusta producer Vietnam's large crop weighed on prices. "There's a massive robusta crop in the offing and that's going to depress prices," Gary Mead, analyst at VM Group said. November robusta coffee on Liffe was down $79 or 3.5 per cent at $2,196 per tonne at 1101 GMT. "There's going to be a surplus of robustas — Vietnam looks pretty good, Indonesia's production is going to rebound, India's crop is looking good," a London-based broker said. ABN Amro/VM Group estimates Vietnamese 2011-12 robusta coffee production will rise to 21.5 million 60-kg bags, compared to the International Coffee Organisation's 2010-11 crop figure of 18.5 million 60-kg bags. "There's no real sign of any supply shortages," Mead said. White sugar futures were steady as continued uncertainty on Brazil's crop size helped underpin the market. Analyst Canaplan continued to hold the lowest view on Brazil sugar output, forecasting the current crop will produce between 28 million-28.5 million tonnes of sugar. "Canaplan's estimate of 28.5 million tonnes of sugar is at the low end of estimates, but no one knows yet what size the crop will end up," a London-based broker said. October white sugar futures on Liffe eased $1.30 to $752.50 per tonne. "Position rolling is putting October/December under pressure ahead of October's expiry next week," the broker said. Cocoa futures were steady, as ample supplies from West Africa weighed on prices, with attention turning to the outlook for 2011-12 supply. Analysts and traders forecast a global 2010-11 surplus in excess of 300,000 tonnes after a bumper West African crop, but also foresee a potential switch to a small deficit in 2011-12. "The only thing that's keeping prices at this level is the expectation of a global deficit next year," VM Group's Mead said. Early indications suggest Ivory Coast is likely to see a decline in production in 2011-12 following this season's record crop with the outlook tempered by meagre rains in early August and a shortage of migrant workers. "Demand is going to be sluggish at best over the next year if the current economic gloom continues," Mead said.