July arabica coffee (KCN24) on Tuesday closed up +10.50 (+5.08%), and July ICE robusta coffee (RMN24) closed up +235 (+6.72%).
Coffee prices today surged to 3-week highs and closed sharply higher. Concerns that excessive dryness in Brazil and Vietnam will damage coffee crops and curb global production have sparked fund buying of coffee futures. Somar Meteorologia reported Monday that Brazil's Minas Gerais region received no rainfall or 0% of the historical average in the past week, the fourth consecutive week the area has received no rainfall. Minas Gerais accounts for about 30% of Brazil's arabica crop. Last Monday, Vietnam's National Weather Agency said rainfall in Vietnam's Central Highland, the main coffee-growing region, totaled 195.6 mm in the ten days from May 1, 41% below the long-term average.
