COMMODITIES-Arabica coffee at 1-year high; soybeans at 5-mth peak

Tue Feb 18, 2014 2:06pm EST

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By Barani Krishnan
    NEW YORK, Feb 18 (Reuters) - The bull run in arabica coffee
futures continued on Tuesday, surging to a one-year high on
worries about a drought in Brazil, and concern about South
American crop weather also pushed soybeans to a five-month peak.
    U.S. natural gas also rose, flirting with a four-year
high as forecasts called for below-normal temperatures across
the United States that should boost heating demand and shrink
end-of-season gas stockpiles to the lowest since 2003. 
    Raw sugar prices were at their strongest in two
weeks. 
    Silver, crude oil and gasoline were
among other markets that rose at least 1 percent each on the
day.  
    The Thomson Reuters/Core Commodity Index jumped
1.5 percent, its highest level since March 2013. Sixteen of the
19 components on the commodities bellwether were up on the day.
    Arabica prices jumped almost 9 percent, gaining for a second
straight day. Arabica has risen in eight of the 11 sessions in
February, making it the CRB's best performer year-to-date with a
40 percent gain.
    "I think we have a lot more upside," a U.S.-based arabica
trader said, adding that funds were taking new long positions
and covering shorts on the belief that Brazil will not get the
rain needed to recover from the drought.
    Persistent dry conditions in Brazil have many now believing
the country's coffee production will be curbed. Brazilian
forecaster Somar said light rainfall will continue after three
days of heavier rains broke a long period of drought, though
rains will ease in some regions. 
    The benchmark second-month arabica futures contract in New
York was up 12.65 cents, or 8.9 percent, at $1.5495 per
lb by 1:38 p.m. EST (1838 GMT). Earlire, it reached $1.5665, the
highest since January 2013. 
    Soybean prices also rose on worries about drought in Brazil
and inclement weather in another major South American soy
producer, Argentina.
    Analysts at Brazilian consultancy AgRural shaved 1.8 million
tonnes off their estimate for Brazil's 2013-14 soybean crop on
Monday, saying drought in much of the country in recent weeks
had reduced yields.
    In Argentina's main soybean-growing region, weeks of heavy
rain have encouraged the spread of caterpillars that are eating
into the 2013/14 season's crop yields, a climate expert said on
Monday.
    U.S. soybeans' front-month contract jumped 23-1/4
cents, or 1.7 percent, in Chicago trading to reach $13.60-3/4
per bushel, the highest for a spot-month soybean contract since
Sept. 19. 
    Prices at 1:47 p.m. EST (1847 GMT)                          
                     
                              LAST      NET    PCT
                                        CHG    CHG
US crude             101.83     1.53   1.5%
Brent crude         109.94     0.76   0.7%
Natural gas           5.503    0.289   5.5%
                                                          
US gold             1324.00     5.40   0.4%
Gold                1323.56    -4.93  -0.4%
US Copper              3.29     0.02   0.6%
LME Copper         7189.00    16.50   0.2%
Dollar               80.004   -0.132  -0.2%
CRB              297.803    4.565   1.6%
                                                          
US corn               448.50     3.25   0.7%
US soybeans          1360.75    23.25   1.7%
US wheat              611.50    13.00   2.2%
                                                          
US Coffee            153.00    13.10   9.4%
US Cocoa            2923.00   -11.00  -0.4%
US Sugar              16.22     0.59   3.8% 
                                                            
US silver            21.900    0.005   2.2%
US platinum         1424.40    -5.70  -0.4%
US palladium         737.00    -0.60  -0.1%
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