After the Volcafe trading company published its quarterly forecast for the Brazilian and global coffee crops yesterday, the price of Arabica coffee inched up to 118.70 US cents per pound from the 19-month low it had recorded the day before.



While Volcafe was still predicting a Brazilian coffee crop of 51.9 million bags in May, its forecast is now for only 48.3 million bags. The crop was harder hit by the drought in 2014 and early 2015 than initially expected.



"Global production was likewise revised down by 4.9 million bags as a result, and is now expected to total only 149.6 million bags. What is more, Volcafe anticipates that stocks will be virtually depleted by end of the 2015/16 season", says Commerzbank.