Coffee soars as rain slows in Brazil

By Andres R. Martinez
Bloomberg News

CHICAGO: Coffee rose to the highest price in 30 months as forecasts for dry weather in Brazil, the largest producer, renewed speculation that crops might be damaged by a prolonged period of below-normal rainfall.

No significant rain is expected to fall in Brazil's major coffee-growing states of Minas Gerais and São Paulo at least until next week, according to the forecaster Meteorlogix. Prices jumped 11 percent in September as the lack of moisture raised concern that the flowering of coffee trees may be disrupted.

"There is still no rain, just dryness," said Donna Heidkamp, a broker at RJO Futures in Chicago.

Coffee futures for December delivery rose 6.4 cents, or 5 percent, to $1.3505 a pound on ICE Futures, formerly known as the New York Board of Trade.

More >>