By Claudia Carpenter -
Dec 20, 2010 1:11 AM ET
Arabica Coffee May Extend Gains to
$4 a Pound in 1st Quarter, Hackett Says
coffee prices may be set for a “straight up vertical
spike” to a record $4 a pound by the end of the first
quarter with daily gains of 50 cents a pound after climbing
to a 13-year high last week, researcher Shawn Hackett
is no longer a “value commodity” and roasters are facing
a “panic stricken demand rationing orgy,” Hackett, president
of Hackett Financial Advisors Inc. in Boynton Beach,
Florida, wrote in a report dated Dec. 18. Prices for
robusta coffee traded in London may climb to $2,500
a metric ton on rising demand from Asia and lack of
production growth from Vietnam, the world’s largest
grower of the beans, Hackett said by e-mail yesterday.
in Latin America will likely keep coffee production
from exceeding output for the last two years, according
to Hackett. Arabica coffee will probably end the year
at $3 a pound, Hackett said.
futures in New York on Dec. 17 jumped to the 13-year
high of $2.267 a pound. Robusta coffee in London closed
the week at $1,986 a ton.
cocoa, lumber, milk and natural gas are commodities
that still have “pockets of value,” according to Hackett.
The Continuous Commodity Index of 17 raw materials futures
will probably climb to a record by year-end, he said
in yesterday’s e-mail. The index closed on Dec. 17 at
603.35 and the high is 615.04 on July 3, 2008, according
to data on Bloomberg.