Tata Coffee: Price Could Move Lower As A Bumper Brazillian Coffee Crop Hits The Market

Coffee jumped Friday as investors went bargain hunting after this week's big correction in commodities, but a bumper crop from No. 1 producer Brazil should drive prices lower in coming weeks, analysts said.

Coffee for September delivery added 2.1 cents, or about 2 percent, to settle at $1.373 a pound on the ICE Futures US, after earlier rising to $1.38.

"Most commodities have been declining over the week, so they're seeing a little retracement and coffee is getting a boost from that," said Rohit Savant, analyst with CPM Group in New York.

But prices could soon turn lower, Savant said, as shipments from Brazil's ongoing harvest begin hitting the market. Brazil is expecting to produce 51.1 million 60-kilogram bags of coffee this year, a 36 percent increase over the previous year and its second largest crop on record.

The South American country ramped up production to cash in on rising coffee prices and also benefited from favorable weather in main coffee-growing regions.

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