UK: Coffee deal off the boil
The Association of Coffee Producing Countries (ACPC) had agreed to hold back 20% of coffee production for two years to boost prices.
Coffee prices recently reached a seven-year low of $890 a tonne for July delivery.
Now doubts are surfacing as to whether Brazil, the world's largest coffee producer, will actually implement the scheme.
Also, countries which are not ACPC members are reported to be reconsidering their commitments.
"The gloss put on the ACPC plan last week is waning. It seems to be falling apart quicker than expected," said one London trader.
Brazil, which is supposed to start holding back coffee shipments from 1 June, has yet to tell coffee producers what the new export regulations will be.
Some major exporters who are not ACPC members are beginning to express doubts about taking part in the scheme.
Mexico, the world's fifth largest producer, has made it clear it will not stockpile coffee, planning instead to boost domestic demand.
Indonesia said it would only consider holding back production for next year's crop, which will not come to market until next spring.
Vietnam, Honduras and Nicaragua said they had only agreed to measures to ensure an "orderly flow" of coffee.
"Finally, the market is realising that non-ACPC members signed up to regulating coffee exports, not retention," said Andrea Thompson of CommodityExpert.
The members of ACPC are supposed to tell the London-based secretariat by 16 June how they will restrict output.
The cutbacks are supposed to come into force on 1 October.
ACPC countries produce 54m bags of the 78m bags of coffee exported worldwide each year.
Half of that production comes from Brazil.
There is growing scepticism in the market that the commodity pact will ever be implemented.
"It just takes one country to say they are not going to do it and then a lot of others might feel the same way," said one trader.
Coffee prices, which rallied last week on the news, dropped by nearly $50 a tonne on Friday.
In the l970s a number of commodity pacts were tried to boost the income of developing countries, but few survived.
It is only the Organisation of Petroleum Exporting Countries, OPEC, that has had some success in restricting output and boosting the price of oil.
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