REPORTS FROM PERU AND IVORY COAST FAIL TO STIR COFFEE MARKET

REPORTS FROM PERU AND IVORY COAST FAIL TO STIR COFFEE MARKET

Coffee prices moved higher Monday on anticipation of new export business.

News of a smaller Peruvian crop and reports of a strike by Ivory Coast policemen were shrugged off by most coffee traders.The active September coffee futures contract closed up 82 points to 98.70 cents a pound. Spot July was over the 96-cent ceiling of recent sessions, closing at 96.65 cents.

The news that Peru's coffee production is likely to fall by 40 percent in the 1989-90 crop year (October-September) had slight effect on futures prices in London and New York.

Peru's delegate to the International Coffee Organization Friday told Knight- Ridder Financial News he expected arabica coffee exports to fall to 1 million 60-kilogram bags from the 1.5 million exported in the last crop year,

mainly because of drought.

Traders say producers' costs have also risen in Peru because they have been forced to move coffee to the south and then back north by rail to avoid terrorist-controlled areas.

The coffee market has been waiting for weeks for physical news to provide direction, but despite that did not react to the reported Peruvian cut or reports of escalating problems in Ivory Coast.

Ivory Coast is the world's second-largest robusta producer.

Traders noted the coffee market has so far been more worried about the

size of the Brazilian crop than about problems in Peru, though the latter is a significant exporter of good (but not top) quality arabicas, and the large export cut should steady prices. Brazil, the world's largest coffee producer, is expected to announce revised production and export estimates sometime within the next two months.

Trade sources said the Peruvian cut in exports would not have a major effect on supplies. Coffee producers in that country have been having transport problems for two to three years, they added.

The large coffee roasters are believed to have built up inventories when New York was trading at 88 to 90 cents and are not expected to buy again until later in the summer when Brazil starts to sell aggressively, enabling the roasters to buy cheaply, which is the usual market pattern, they said.

Futures prices initially rose on carryover fund and commission-house buying based on Friday's strong close and encouraged by news of further unrest in the Ivory Coast, though that was a minor consideration.

''It looks like we're establishing a new trading range," a trader said.

"We couldn't get (down) through 90 so we're up around 96. But I think it would take a frost or something strong to get this up much further," he added, referring to July's movement in the 90-cent to 96-cent range.