Coffee futures prices continued to fall on Tuesday, marking the seventh decline session in the last two weeks. The commodity fell as low as $142.55 per 100 lbs – the lowest price since January 9.
Fundamentally, the coffee market is reacting to consistently changing estimates over the yields of the upcoming crop in Brazil – a major producer of Arabica and Robusta beans.
Overall, bumper yields are expected in Brazil due to a few seasons of drought in its top Robusta growing region. Therefore, Brazil, which is currently a major exporter of coffee, may have to import the commodity due to the shortfall. The drop in futures price came after a representative from Brazilian coffee farmers stated that imports will not be necessary.
Buy Digital Put Option from 142.50 to 141.00 valid until 20:00 GMT February 08, 2017