Why Are Coffee Prices Going Higher ?
Coffee Futures—Coffee futures in the May contract is slightly lower this Wednesday afternoon in New York down 35 points at 125.25 a pound breaking a 5 day winning streak as prices are still hovering right at a 2 1/2 month high.
Coffee prices are trading above their 20 & 100 day moving average as the 100 level held once again in last week’s trade as that has acted like cement over the last year as I am currently not involved as these markets are crazy at the present time.
Fundamentally speaking coffee prices have rallied on concerns about supply disruptions in South America. Brazil’s Sao Paulo state will begin a 15-day quarantine starting Tuesday, Columbia put its entire population on a 3-week lockdown, and El Salvador ordered the closure of all non-essential businesses through April 3.
Last Friday, coffee-trader Volcafe told clients that the coronavirus pandemic is causing logistical hold ups that will become “more widespread” in major coffee-producing countries, which may delay coffee shipments to ports and other transport operations.
CHART STRUCTURE: POOR
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