Coffee
While coffee prices are on an uptrend lately on higher demand, inclement weather in the major producing region – Brazil – have hampered the output.
Also, increasing demand in global markets owing to a rebound in economic conditions boosted the outlook for coffee prices.
Three years of drought in Brazil has primarily resulted in the dreary situation. As per Financial Times, about 90% of Brazil’s robusta beans — the lower quality type — is consumed domestically. Lack of supplies led Brazilians to opt for their first bean import.
Investors can thus invest in exchange-traded products like iPath Bloomberg Coffee Subindex Total Return ETN JO and iPath Pure Beta Coffee ETN CAFE. Both the products have a Zacks Rank 2 or a ‘Buy’ rating and charge 75 bps (see all agricultural ETFs here).
Source: Zack's Research