COFFEE PRICE FALL SHORT TERM - DUTCH ROASTERS

  This morning's sharp decline in coffee
  prices, following the breakdown late last night of negotiations
  in London to reintroduce International Coffee Organization,
  ICO, quotas, will be short-lived, Dutch roasters said.
      "The fall is a technical and emotional reaction to the
  failure to agree on reintroduction of ICO export quotas, but it
  will not be long before reality reasserts itself and prices
  rise again," a spokesman for one of the major Dutch roasters
  said.
      "The fact is that while there are ample supplies of coffee
  available at present, there is a shortage of quality," he said.
      "Average prices fell to around 110 cents a lb following the
  news of the breakdown but we expect them to move back again to
  around 120 cents within a few weeks," the roaster added.
      Dutch Coffee Roasters' Association secretary Jan de Vries
  said although the roasters were disappointed at the failure of
  consumer and producer ICO representatives to agree on quota
  reintroduction, it was equally important that quotas be
  reallocated on a more equitable basis.
      "There is no absolute need for quotas at this moment because
  the market is well balanced and we must not lose this
  opportunity to renegotiate the coffee agreement," he said.
      "There is still a lot of work to be done on a number of
  clauses of the International Coffee Agreement and we would not
  welcome quota reintroduction until we have a complete
  renegotiation," de Vries added.
      With this in mind, and with Dutch roasters claiming to have
  fairly good forward cover, the buying strategy for the
  foreseeable future would probably be to buy coffee on a
  hand-to-mouth basis and on a sliding scale when market prices
  were below 120 cents a lb, roasters said.
  

