(Bloomberg) -- Arabica coffee futures surged in New York as persistent dryness in top-supplier Brazil elevates fears of a crop failure.
The most-active futures contract settled 4% higher in New York at $2.5945 per pound, the highest settlement price since 2011.
Temperatures will be high in most of the coffee-producing areas through the weekend, Climatempo meteorologist Dayane Figueiredo wrote in a Friday report. That’s bringing concern of damages to trees that are in their flowering period, a crucial moment that will determine how many beans will be harvested next year.
In addition, in parts of the top coffee-growing state of Minas Gerais, crops are being impacted by soot from fires, Climatempo said. While there haven’t been reports of coffee trees hurt in wildfires, the proximity of those crops potentially could harm buds.
“Those are new and unknown elements,” said Carlos Santana Jr., a Brazil-based commercial director at trader Ecom Group.
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