Coffee Market Report December 08 2016

8th. December, 2016

The Brazil Exporters Association Cecafe have reported that the countries green coffee exports for the month of November were 460,000 bags or 14.20% lower than the same month last year, at a total of 2.78 million bags.  The bulk of these exports are attributed to arabica coffee exports to a total 2.75 million bags, and following this year’s dismal conilon robusta coffee crop, conilon coffee exports contributed a lower total 30,000 bags, for this month of exports.
 
The March to March contracts arbitrage between the London and New York markets widened yesterday, to register this at 50.03 usc/Lb., while this equates to a 35.30% price discount for the London robusta coffee market.  This arbitrage remains an attractive factor for the roasters who have considered robusta coffees to be an opportunist discount component, within their mostly arabica coffee blends.

The Certified washed Arabica coffee stocks held against the New York exchange rose by 2,750 bags yesterday; to register these stocks at 1,262,724 bags.  There was meanwhile 3,850 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 12,568 bags.

The commodity markets were mixed in trade yesterday, as the US Dollar slipped back against a basket of other major currencies and the oil markets tending softer on the day. It was a positive day for Soybean, Sugar, Gold, Silver and Platinum, although a softer day for for Cocoa, Coffee, Cotton, Copper, Corn, Wheat, Palladium. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.1855% lower; to see this Index registered at 425.869.   The day starts with the U.S. Dollar trading at 1.265 to Sterling and 1.077 to the Euro, while North Sea Oil is tending steady and is selling at 51.37 per barrel.
 
The London market started the day on a softer but steady note yesterday, to turn positive during the session as New York market registered a positive track to start the day.  The New York market held steady at the outset and in positive territory although seller activity at the top of the day gradually etched away the gains, to see this market push lower to move through opening levels and into negative territory by midsession.  This softer move was mirrored in London, to see both markets trading in mildly negative territory for the latter half of the day and in New York within a tightly held range either side of unchanged.  As the session progressed toward the finish line, a degree of seller pressure withdrew from the floor and both markets posted a modest boost, but still in negative territory, to set the close in London about the middle of the days trading range, and in New York just about unchanged on the day, as follows:

LONDON ROBUSTA US$/MT                        NEW YORK ARABICA USc/Lb.

JAN      2030 –   9                                            DEC   137.90 – 0.05
MAR     2021 – 11                                            MAR   141.70 – 0.30
MAY     2031 – 10                                            MAY   144.05 – 0.25
JUL      2038 –   8                                            JUL    146.20 – 0.25
SEP      2044 –  7                                             SEP    148.25 – 0.20
NOV     2050 –  6                                             DEC    151.20 – 0.20
JAN      2056 –  2                                             MAR   153.80 – 0.20
MAR     2066 –  2                                             MAY   155.40 – 0.20
MAY     2082 –  2                                             JUL    156.85 – 0.15
JUL      2100 –  2                                             SEP    158.10 – 0.15