Coffee falls as supplies deemed as adequate

Coffee fell for a fifth day in London on signs supplies will be enough to meet demand even as top producer Brazil enters a low-cycle production year. Sugar advanced. Output in the South American country will fall 9.6 per cent to 43.5 million bags in the 2011-12 season as trees enter the lower-yielding half of a two-year cycle, the Agriculture Ministry said. That would be the smallest drop ever recorded for an off year, the International Coffee Organisation said in its June report. While the 2011-12 season starts in October in most countries, the harvesting in Brazil is already under way. Harvesting pressure Article continues below "Harvesting pressure from Brazil's current crop could weigh on prices in the short term," German researcher F.O. Licht said in a report. "Market participants are currently focusing on the reducing frost threat to Brazil's coffee trees as weather conditions look favourable for now." Robusta coffee for September delivery fell $37 (Dh135) a tonne, or 1.7 per cent, to $2,120 a metric tonne on NYSE Liffe in London.