Commodities : Thursday, Nov. 14, 1985 : Coffee Futures Prices Climb

The devastating eruption of a volcano in Colombia’s western coffee-growing region sparked a surge in coffee futures prices Thursday in heavy trading on the Coffee, Sugar and Cocoa Exchange. Thousands were feared killed in the disaster, which hit early Thursday about 60 miles from the heart of the coffee region.

Traders bought on speculation that the eruption had wiped out a substantial portion of Colombia’s coffee crop, analysts said.

“The market closed limit up,” further bolstered by expectations that coffee farmers were among the dead, said Sandy Kaul, a coffee analyst with Shearson Lehman Brothers in New York. “The lack of people to harvest the crop will provide difficulty” in exporting Colombian coffee, she said.

Coffee settled 3 cents to 4 cents higher with the contract for delivery in December at $1.57 a pound.

Soybean futures prices fell while corn and wheat were mixed in trading on the Chicago Board of Trade. Soybean prices remained under pressure from concern that the Agriculture Department’s loan rate for soybean farmers might be lowered when the new farm bill is adopted, said Richard Loewy, senior grain and oil seed analyst in New York with Prudential-Bache Securities.