It has been dubbed as the biggest bullish coffee bet since 208. Rain brought much needed relief to the world’s largest producer and exporter of Coffee-Brazil.
For the first time in four weeks fund managers slashed their net long position in Arabica Coffee. New York futures tumbled 9.1% last week, the greatest since May. More showers will trigger new blooms for coffee plants; most flowers were lost to the drought conditions last month.
Prices of Coffee shot up by 72% and it constituted the biggest gain among 22 raw materials which was tracked by Bloomberg Commodity Index. It was the biggest drought for almost eight decades in Brazil and even threatened the water supplies in Sao Paulo, one of the biggest metropolis in South America. The drought threatened the year’s coffee production and also the quality of the crop for 2015.
Paul Christopher, the St. Louis-based chief international strategist at Wells Fargo Advisors, which oversees $1.4 trillion, said Oct. 22, “Prices were reflecting a continuation of the drought. If it is to end, that would be a new scenario. If the rains continue, it will certainly undercut the rally.”cialis price at walmart