Feb. 20 (Bloomberg) -- Coffee futures rose the most in five weeks on signs of deteriorating crops in Central America and Mexico. Sugar, cotton and orange juice gained, while cocoa fell.
Leaf rust, a fungal disease also known as Roya, may cut output in Honduras, Guatemala, Costa Rica, Nicaragua, El Salvador and Mexico by 20 percent this season and 25 percent next year, according to industry estimates. As of Feb. 12, money managers and large speculators boosted bets on a price drop to 23,714 futures and options, the most bearish since Dec. 18, government data show.
“The Roya situation seems to be getting worse,” Sterling Smith, a futures specialist at Citigroup Inc. in Chicago, said in a telephone interview. “This is making some of the shorts nervous.”
Arabica coffee for May delivery jumped 2.3 percent to settle at $1.4165 a pound at 2 p.m. on ICE Futures U.S. in New York, the biggest gain for a most-active contract since Jan. 11.
The price posted the biggest gain among 24 raw materials in the Standard & Poor’s GSCI Spot Index. The broad measure headed for the biggest drop since November, led by precious metals and energy.
Yesterday, coffee touched $1.376, the lowest since June 2010, on signs of ample supplies from Brazil, the world’s top grower, and higher production in Colombia, the second-biggest producer of arabica beans.
“The market still feels heavy, unable to get any decisive upside traction,” Smith said. “We need to post a weekly close above $1.42, which should prompt more buying.”
Raw-sugar futures for May delivery climbed 0.9 percent to 18.13 cents a pound on ICE.
Cotton futures increased 0.4 percent to 84.46 cents a pound. Earlier, the fiber reached 85.24 cents, the highest since May 10.
Orange-juice futures for May delivery rose 1.2 percent to $1.2645 a pound.
Cocoa futures for May delivery fell 0.3 percent to $2,113 a metric ton. Earlier, the price touched $2,105, the lowest since June 25.
--With assistance from Oliver Renick in Chicago. Editors: Patrick McKiernan, Thomas Galatola