Newspaper article THE JOURNAL RECORD

Fears of Strike Disruptions Send Coffee Futures to 20-Month High

Newspaper article THE JOURNAL RECORD

Fears of Strike Disruptions Send Coffee Futures to 20-Month High

Article excerpt

NEW YORK -- Coffee soared to a 20-month high on concern that a strike in Colombia today will disrupt exports at a time of lean U.S. inventories.

On other markets, orange juice fell while heating oil rose. The Commodity Research Bureau index gained 0.55 to 237.30. The energy- weighted Goldman Sachs Commodity Index rose 0.61 point to 195.32.

Workers in Colombia's government and state-owned industries plan to walk off the job for at least one day starting today to protest low wages and government efforts to sell state assets. The strike ignited speculation that coffee shipments from Colombia, the world's second-largest grower, will be delayed, though Colombian port officials said they don't expect the strike to disrupt exports. A snag in exports would come with Coffee, Sugar & Cocoa Exchange stockpiles at 20,795 132-pound bags, about a fifth their size last year. "There's going to be a big strike in Colombia and the rumor is that coffee is going to be included," said Oscar Schaps, a trader at Hencorp Coffee Group in Miami. "Talk that coffee shipments could be delayed took the market up." Coffee for March delivery soared 7.60 cents to $1.5865 a pound on the CSCE in New York, the highest price for the most-active contract since June 2, 1995. Coffee prices soared 47 percent during the past two months amid record low inventories and signs that Brazil and Colombia's crops - - the world's two largest -- would run short of forecasts. While a quick end to the strike in Colombia would drive prices lower, signs of delays could fuel the rally. "The coffee market looks very bullish with these low inventories," said Dario Sarmiento, a trader at Gryphus Investments in Miami. Orange juice fell for a third day amid mounting perceptions that last month's freeze in Florida inflicted less damage to the state's crop than initially estimated. Orange groves in Florida, the largest producing state, suffered their worst freeze since 1991 during the weekend of Jan. 18, when temperatures dropped into the low 20 degrees Fahrenheit. …

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