By Julie Wernau

Coffee futures slipped for a third straight session Friday as the market reacted to news that Brazil won't import lower-grade coffees to boost domestic supplies.

Arabica coffee for May delivery lost 2.5% to end at $1.4625 a pound on the ICE Futures U.S. exchange.

Brazilian President Michel Temer on Wednesday reversed a decree issued by the country's Ministry of Agriculture that would have allowed Brazilian coffee processors to import robusta coffee--a more acerbic bean typically found in instant coffee--from Vietnam. Brazil produces its own robusta coffee, but stocks in Brazil have declined following two years of drought in those growing regions, boosting domestic prices.

Commerzbank said in a note that stocks have dropped to 2 million bags, which processors say amounts to less than two months of demand.

Following protests among coffee producers, the president reversed the decision, which would have been a first for the world's largest coffee-growing region. The country is on holiday for Carnival until next Wednesday, with warehouses and exporter offices closed and no buying interest in the market.

"The most intriguing fact of the week was the yes and no to robusta imports," said Thiago Marques Cazarini, a coffee broker with Cazarini Trading Co. in Brazil.

Mr. Temer has ordered another count of coffee stocks.

In other markets, raw sugar for May lost 1.6% to settle at 19.81 cents a pound, cocoa for May delivery was down 1.6% to settle at $1,994 a ton, frozen concentrated orange juice lost 1.8% to close at $1.6505 a pound, and May cotton rose 0.6% to end at 76.57 cents a pound.

Write to Julie Wernau at julie.wernau@wsj.com

(END) Dow Jones Newswires

February 24, 2017 15:16 ET (20:16 GMT)